The urgent need for data centres versus the protection of the Green Belt
In the UK the development of data centres has run into some recent planning blocks, despite the urgent need for new data centres driven by the growth in cloud computing, personal internet use and the expansion of digital data.
Where are they located?
The private sector leads the development of data centres and this has resulted in aconcentration of facilities around London in areas known as availability zones,
A recent planning appeal decision said:
"The importance of the site lying within the Slough Availability Zone [SAZ] is that hyperscale data centres need to be developed in clusters… to provide resilience and support for each other in the event of power loss. The SAZ lies close to digital connections which run from London out to the south-west and across the Atlantic to North America. This has driven the growth of data centres along this corridor which includes other areas within London. Hyperscale data centres will not be developed outside recognised availability zones as they will not be able to ensure that access to the data they hold will always be available due to the time taken for data to move between sites..."
The issue the industry now faces is the absence of suitable sites for large data centres, in particular hyperscale data centres, outside of the Green Belt, particularly around London.
The problem with the Green Belt is that the National Planning Policy Framework requires local authorities to give substantial weight to the avoidance of harm to the Green Belt. The NPPF only allows development in the Green Belt in very special circumstances when it must be proved that the benefits from the project outweigh disruption caused.
Planning refused
In November 2021 Greystoke Land submitted a planning application for the redevelopment of a former landfill site in Abbots Langley to deliver a data centre of up to 163,000 sqm (GEA) across 3 buildings. The scheme included site wide landscaping and new parkland.
The council refused the application in September 2022 as it would result in harm to the openness of the Green Belt .
The developer appealed to the Secretary of State and in October 2023, following an inquiry, the Secretary of State dismissed the appeal.
The Secretary of State acknowledged there is significant demand for new data centres in the SAZ and that the proposal would make a significant contribution towards this.
He also noted that there are other Availability Zones in London which are not within the Green Belt, which had not been fully assessed.
The Secretary of State concluded:
"In line with paragraph 148 [now 153] of the Framework, the Secretary of State has considered whether the harm to the Green Belt by reason of inappropriateness, and any other harms resulting from the development, is clearly outweighed by other considerations. Overall, he considers that the other considerations in this case do not clearly outweigh the harm to the Green Belt and to the character and appearance of the area. He therefore considers that very special circumstances do not exist to justify permitting this development in the Green Belt."
Labour: Change
The Labour Party Manifesto stated 'We will ensure our industrial strategy supports the development of the Artificial Intelligence (AI) sector, removes planning barriers to new datacentres. And we will create a National Data Library to bring together existing research programmes and help deliver data-driven public services, whilst maintaining strong safeguards and ensuring all of the public benefit.
In her first speech as Chancellor (on 8 July 2024), the Rt Hon. Rachel Reeves said:
"Nowhere is decisive reform needed more urgently than in the case of our planning system. Planning reform has become a byword for political timidity in the face of vested interests and a graveyard of economic ambition. Our antiquated planning system leaves too many important projects getting tied up in years and years of red tape before shovels ever get into the ground. We promised to put planning reform at the centre of our political argument - and we did. We said we would grasp the nettle of planning reform - and we are doing so… First, we will reform the NPPF, consulting on a new growth-focused approach to the planning system before the end of the month… Secondly, we will give priority to energy in the system to ensure they make swift progress… and we will build on the spatial plan for Energy by expanding this to other infrastructure sectors… Fifth, if we are to put growth at the centre of our planning system, that means changes not only to the system itself, but to the way that ministers use our powers for direct intervention. The Deputy Prime Minister has said that when she intervenes in the economic planning system, the benefit of development will be a central consideration and that she will not hesitate to review an application where the potential gain for the region and national economies warrant it… and I welcome her decision to recover two planning appeals already, for data centres in Buckinghamshire and Hertfordshire."
How might the planning system change?
There is a clear demand for data centres which has increased at such a speed that the planning system has not been able to keep up.
The NPPF protects the Green Belt, but local authorities and the Secretary of State have been reluctant to allow the benefits associated with data centres, to amount to the very special circumstances required to justify Green Belt development.
As the delivery of data centres carry wider regional and national importance, the Government may require a more strategic approach.
The Chancellor has re-emphasised the power held by the Secretary of State to decide planning applications. A ministerial statement sets out the government's call-in criteria, it also notes that ultimately it is up to the Secretary of State to decide whether to use their call-in powers.
If a planning application or appeal is called-in, a planning inspector will review it. The inspector then will carry out an inquiry and issue recommendations to the Secretary of State, who in turn, makes the final decision.
Between January 2019 and December 2023, the Secretary of State called-in 43 planning applications and 76 planning appeals. 61% of the planning applications and 41% of the planning appeals were granted planning permission.
Planning law requires planning applications to be determined in accordance with the development plan unless material planning considerations indicate otherwise. This applies both to local planning authorities and the Secretary of State.
It is however for the decision maker to decide how much weight to apportion to each consideration. Which may open the door to a greater number of planning applications and planning appeals being approved at this level.
We need bolder changes to provide data-centre operators the certainty they need to confidently invest in the UK. This could look like extending the list of buildings set out in paragraph 154 of the NPPF, promoting their delivery in the (newly proposed) Grey Belt or revising the boundary of the Green Belt altogether.
There are also some practical changes the Government could make to speed up the delivery of data centres and encourage investment. This includes requiring the additional planning officers, which have been promised, to focus on infrastructure projects (in balance with the desire to deliver more housing) and widening permitted development rights for statutory undertakers to deliver the infrastructure which is necessary to support date centres.
How we can help
VWV has an experienced team of planning, infrastructure and property lawyers who can help from concept inception to delivery. The firm is known for infrastructure projects and is expanding into the data and super-computer market sector. This includes working in partnership with the University of Bristol on a £225 million Government funded AI supercomputer project.