Ofgem has proposed forcing data centre developers to pay a refundable commitment fee to secure grid connections, aiming to clear a massive backlog of speculative projects that threatens the UK's AI infrastructure ambitions. The fee would range from £237,500 to £712,500 per megawatt, representing 2.5% to 7.5% of typical build costs, and would be returned upon project completion or forfeited if developers abandon the queue.
The regulator warns that speculative bids are clogging the system, with electricity capacity requests surging from 41 GW to 125 GW over the past year—far exceeding the country's 2025 peak demand of 46 GW. More than 140 data centre projects have requested over 50 GW of capacity, and developers would need to hit strict milestones or face removal from the queue.
The consultation runs until 16 September. Energy minister Michael Shanks has backed the move to help viable projects proceed, supporting the government's target of 6 GW of AI-capable data centre capacity by 2030.