Vancouver Courier - Experts Warn Data Centre Boom Could Push 10,000 London Households into Poverty

Experts have warned the London Assembly that the rapid expansion of data centres in the capital could push 10,000 households into fuel poverty and place unprecedented strain on local water resources. The warnings were delivered during a committee meeting this week, where campaigners and researchers outlined the growing risks associated with the sector’s growth.

London currently hosts 99 operational data centres, accounting for more than 80% of the United Kingdom’s total capacity. An additional 26 facilities are either planned or progressing through the planning system. These secure, warehouse-like structures, which house critical IT infrastructure including computing, storage, and networking systems, are concentrated in and around the capital due to their proximity to the City of London financial hub. This geographic clustering creates a "snowball effect," where new facilities are built near existing ones.

Oliver Hayes, head of campaigns at the climate group Global Action Plan, presented findings indicating that high-growth projections for data centres could force 77,000 British households into fuel poverty in the future. Of this total, approximately 10,000 would be located in London. The analysis suggests that the increased demand on the UK’s energy systems from these facilities could add an average of £88 to the average household energy bill.

"It will also further impoverish the households already in fuel poverty," Hayes told the London Assembly environment committee. "This is an enormous issue that is not being adequately considered. Early analysis of that at a regional level suggests that in London that figure would be about 10,000 additional households."

Zack Polanski, leader of the Green Party and a London Assembly Member sitting on the committee, called for immediate intervention. "We need to slam the brakes on the rampant building of new data centres," Polanski said. He argued that many Londoners are already struggling with high bills and low wages, and that prioritizing data centres over housing exacerbates the city’s emergency.

"Building more data centres risks pushing tens of thousands more households into fuel poverty, and that’s especially worrying here in London, where so many data centres are being proposed," Polanski stated. "Data centres don’t just threaten our climate targets by driving up emissions, but at a time when London is facing a housing emergency we cannot afford to prioritise data centres ahead of the homes our city desperately needs."

Beyond energy concerns, assembly members were alerted to the significant water consumption required by these facilities. Jon Chappell, deputy director of Water UK, explained that the industry’s demand increases peak usage during summer months, necessitating larger service reservoirs and treatment works.

Chappell estimated that if every new data centre were built to the standards of the least efficient existing facility, the country would require an additional 77 million litres of water per day. This volume is equivalent to the daily water needs of three London boroughs. He warned that this demand could hinder ministerial and City Hall ambitions, noting that in parts of eastern and southeastern England, housing developments and business expansions are already stalled due to water shortages.

Researchers also cautioned that headline water figures often underestimate the true environmental cost. Rory Murphy, a research associate at the University of Exeter, pointed out that direct cooling accounts for only a fraction of total usage. He cited US data showing that while 66 billion litres of water were used directly to cool servers in a given year, 800 billion litres were consumed indirectly to keep the servers operational.

"We need to consider the wider indirect effects, particularly when considering the stress that this could place on an already stressed infrastructure," Murphy urged.

The Mayor of London has previously commissioned a study on the implications of data centres for the capital’s water supply. In response to concerns raised by Labour Assembly member James Small-Edwards last year, the Mayor noted that cooling technologies vary, with some using water and others relying on air or non-water systems. Earlier this year, the Mayor emphasized the need for a comprehensive plan to address both water and grid impacts, particularly regarding domestic demand during hot summers as AI usage increases.

The draft London Plan, which guides local councils on planning decisions, states that data centres in suitable locations should be supported in principle. However, approval is contingent upon the availability of sufficient water and electricity capacity.

C.Brown--VC