- Planning submitted for 500,000 m² AI campus
- Energy and governance tensions emerge
What happened: Government backs massive AI growth zone at Teesworks
The UK cabinet has approved Teesworks in northeast England as the site for the nation’s second AI Growth Zone. Teesworks Ltd submitted plans for a nearly 500,000 m² data centre project. This centre could become the largest AI hub in Europe. The Department for Science, Innovation and Technology has led talks with major tech firms like Microsoft, Anthropic, DeepMind and Google. The project offers fast‑track planning and assured energy access for cloud and AI workloads.
However, the Department for Energy Security and Net Zero raised concerns about the high power and water needs of such data centres. The site’s proximity to BP’s proposed blue hydrogen and carbon capture plant has sparked a clash between the data centre and clean energy proposals. Local governance issues have also surfaced. A 2024 review flagged a poor‑value land transfer, leading to oversight interventions. A decision on BP’s competing project is expected by 28 August, which may influence the AI centre’s future.
Also read: DOE identifies sites for AI data centres
Also read: Oklo and Vertiv join forces for AI data centres
Why it’s important
Placing an AI data centre of this scale at Teesworks aims to reinforce the UK’s position in global tech infrastructure. Fast‑track planning and dedicated energy support may attract hyperscalers seeking compute capacity. However, the project creates a stark test case for aligning innovation goals with climate commitments. High water and power consumption demands intensify pressure on local ecosystems and national net‑zero policies.
Tensions between government departments over clean energy versus digital growth reflect competing priorities. Governance concerns over land deals and oversight highlight the need for robust transparency measures. The ministerial decision on the BP hydrogen‑CCUS plan may set precedent on how AI hubs coexist with low‑carbon energy projects. Delivering this AI campus could stimulate local economies but hinges on reconciling conflicting environmental, energy and policy goals.
