• Analysis
National Grid substation on Teesside set to be Britain's biggest, next to planned AI datacentre
National Grid has agreed to buy 29.5 hectares (73 acres) at Dorman Point on Teesside as a step toward building Britain's biggest electricity substation, sited next to a planned AI datacentre on land owned by Teesworks.
A land deal at Dorman Point
National Grid took a concrete step last week toward what would be the biggest electricity substation in Britain: it agreed to purchase 29.5 hectares (73 acres) of land at Dorman Point on Teesside. The site is owned by Teesworks, a local private-public partnership. The land deal was first reported by Sky News.
The AI datacentre next door
The substation would sit beside a large planned AI datacentre. Reports last year said the UK government had chosen Teesworks for a new artificial intelligence datacentre, and planning applications have since been submitted for a project that would span nearly 500,000 square metres.
What the grid means for AI capacity
Matt Pearce, head of land at National Grid, described the agreement as the product of constructive work among those involved to enable vital infrastructure. He said it will support the growth of AI and digital technologies, and enable the region's next phase of industrial and economic development.
"We are committed to working closely with our partners to progress the development as quickly as possible"
Ben Houchen, mayor of the Tees Valley combined authority, framed the project as the answer to the power bottleneck holding datacentres back.
"Everyone who has tried to build a datacentre in this country knows the biggest problem is getting enough power to the site quickly"
His argument, in his own account, ran as follows:
- •While Britain has been stuck in the queue, the US, the Gulf and parts of Europe have been attracting the investment.
- •Having up to 3.2GW of capacity at the site means the region can finally compete for those datacentre projects.
- •Britain needs somewhere to physically put AI data if it is serious about its own AI capability: "I'd much rather that was Teesside than Texas or Abu Dhabi."
Who builds it, and the wider policy backdrop
- •Balfour Beatty, a London-listed infrastructure services group, was reported to be in line to deliver the Teesworks substation for National Grid.
- •The utilities firm Steel River Power (SRP) is also heavily involved in the project; both firms were approached for comment.
The project lands amid an active policy debate. Last week the government published a draft national policy statement describing datacentres as fundamental to the economy as the railways and electricity networks, and saying the country must take control over their development so the country and host communities benefit.
Opposition to such construction has been strong, with campaign groups protesting planned developments in places ranging from Auchtertool, a village north of Edinburgh, to Brick Lane in east London. In October, AI companies reportedly told ministers they had 12 months to head off public opposition to datacentres or risk US-style protests threatening construction.
