Drax and Brookfield have announced plans to develop vast data centre capacity at the energy group’s wood-fired power station in North Yorkshire with Qatari backing. The arrangement could see Drax’s biomass plant powering AI models by next decade, although initially the electricity would come from the broader grid through an existing connection. The UK energy group and the Canadian infrastructure investor Brookfield said they were joining forces to try to get up to 100 megawatts of data centre capacity up and running by 2028, increasing to 500MW by 2031 and up to 1 gigawatt in the 2030s.
The second phase would bring the data centre “behind-the-meter”, meaning it would take electricity directly from the biomass plant. The plans are likely to require up to £2.5bn investment in its first phase and up to £20bn in total, Drax said. A joint venture between Brookfield and Qai, a subsidiary of the Qatar Investment Authority, will provide initial investment for the project.
Brookfield’s UK AI platform Radiant will develop the project with Drax. London-listed Drax has been looking for revenue to replace its current UK government subsidies, which are provided on the basis of biomass being a renewable source of electricity. The government extended the backing last year to 2031 on the basis that the Drax plant was necessary to maintain the UK’s “near-term security of supply” for electricity.
Data centre developers are looking to set up in the UK but have challenges accessing sufficient power supplies and land — both of which Drax can offer. The Drax and Brookfield partnership is at an early stage: the companies will still need to secure government approvals as well as a data centre tenant for the site. Drax’s chief executive Will Gardiner said the project would “help secure the long-term future of the site and protect hundreds of jobs”.
Drax shares climbed 9 per cent to 880p in early trading.
Source: Financial Times Companies · Summarized by HeadlinesBriefing