'Everything else will go where it is easier to build': Experts warn UK data centre market is lagging behind Europe — even as demand continues to soar

A new report by consultancy firm Kearney warns that the UK's data center market is lagging behind Europe, despite the government's optimistic projections. According to Kearney, the UK could be one of the slowest-growing data center markets in Europe, with demand only expected to increase by 17.6% annually between now and 2030. In contrast, Ireland is forecasted to see an annual growth rate of 36%, around double the UK's.

The primary reason for the UK's sluggish growth is the country's inability to efficiently and affordably accommodate new infrastructure. Energy availability is a major obstacle across Europe, with forecasts predicting a significant increase in demand for data center consumption by 2035. However, land prices are also a concern, with UK data centers facing higher costs compared to Nordic markets.

While the UK and other Western European sites are projected to incur expenses of around €2.25 million per megawatt, Nordic countries can achieve a lower average of €600,000 per megawatt. This puts Finland and Norway's anticipated annual growth rates at 37.6% and 36.8%, respectively, between now and 2030.

European Data Center Lead Christoph Neunkirchen explained that the next wave of data center capacity must be built in locations where power and land are scarce enough to meet workloads that require proximity to users, customers, and national jurisdictions. For the UK, in particular, Kearney emphasizes the need for lower electricity prices, cheaper land, and faster grid connections to meet the government's projected demand for 6GW of AI data center capacity by 2030.