Planning, power and politics threaten Britain’s AI dreams

By Tom Bristow, Nicholas Earl, Joseph Bambridge | 11/13/2025 06:35 AM EST

Without energy and planning reform, new data center projects — and the billions of pounds of investment they bring — are at risk.

The Microsoft pavilion stands at the 2025 Hannover Messe industrial trade fair.

Microsoft has chosen an area of South Wales — once the world’s steel capital — to build hulking new data centers. Sean Gallup/AFP via Getty Images

NEWPORT, Wales — Road signs around Newport still refer to this sprawling former industrial site as a radiator factory. But soon, it will generate a different kind of heat.

Microsoft has chosen this area of South Wales — once the world’s steel capital — to build hulking new data centers. Five buildings, covering an area larger than three football pitches, are springing up to meet what the company describes as “exploding demand” for artificial intelligence compute power.

For Microsoft, the area’s industrial heritage is precisely why it’s investing. Newport’s legacy of heavy-duty factories means it has the infrastructure needed for energy-intensive data centers.

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But doubts over whether Britain can supply enough energy to keep up with demand from data centers are an urgent problem for the government’s AI ambitions.

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