George Osborne has accused opponents of new AI data centres of holding Britain back, arguing that blocking the huge facilities will leave the country dependent on infrastructure built in the United States.
The former Conservative chancellor, who now works for OpenAI as its head of AI for countries, said Britain risked losing control over an increasingly important part of its economy if new data centres could not be constructed.
His comments come amid protests over the amount of water and electricity consumed by the facilities, their impact on the landscape and doubts about how many permanent jobs they create.
Opponents have also questioned whether land, grid connections and public investment should be committed to data centres while communities struggle to secure new housing and local infrastructure.
Osborne dismissed much of the opposition as “not in my back yard” politics.
‘It’s really hard to build a data centre’
Speaking at the Big Brue festival in Somerset, Osborne compared opposition to data centres with the resistance governments face when attempting to build roads, railway lines and airport runways.
He said communities frequently “go up in arms” when major infrastructure is proposed near them.
“It’s really hard to build a datacentre,” he said.
Osborne argued that the facilities would be constructed somewhere, even if Britain rejected them. The likely beneficiaries would be American states such as Ohio, Georgia and Michigan, where a major expansion of AI infrastructure is already under way.
Allowing that to happen would mean a “loss of some sovereign control” over where the technology and its underlying computing power are located, he warned.
The argument is straightforward. Britain wants to become a leading AI economy, but the most powerful models require enormous quantities of computing power. That computing power has to be housed somewhere.
If the servers sit almost entirely in the United States, British businesses and public services remain dependent on American technology companies and infrastructure.
Osborne’s interest is not purely academic. His role at OpenAI involves building relationships with governments and helping countries develop the infrastructure needed to use the company’s technology.
Why communities are protesting
The facilities being debated are not ordinary office buildings.
Large AI data centres can contain thousands of power-hungry processors operating continuously. They require substantial grid connections and cooling systems, with some using drinking-quality water to keep equipment at safe temperatures.
Government research says cooling can account for up to 40 per cent of a data centre’s total energy consumption. The demands can be particularly high in AI facilities because their processors are more powerful, their servers are packed more densely and their workloads run for longer.
A Chatham House analysis found that 84 per cent of proposed British data centres were planned in areas expected to experience water stress by 2040.
The government has argued that the current national demand is comparatively small. Data centres reportedly account for less than one per cent of non-household water use in England, and ministers say their critical infrastructure status does not automatically give them priority over homes during shortages.
The concern is how quickly that demand could grow.
A government sustainability analysis warned that global water consumption associated with AI could rise from 1.1 billion cubic metres to 6.6 billion cubic metres by 2027. Water is used directly for cooling, indirectly in electricity generation and during the manufacture of servers and other equipment.
That is why opponents reject the claim that they simply do not want an unattractive building nearby.
Protests have taken place in London, Devon and outside the Scottish Parliament. Campaigners have demanded clearer answers about water use, electricity consumption, carbon emissions, grid connections and the number of jobs that will remain after construction ends.
Scotland has already applied the brakes
The debate has moved beyond demonstrations.
MSPs have backed tighter environmental scrutiny for hyperscale data centres in Scotland, including a pause of up to one year on planning decisions while national guidance is developed.
New projects will be expected to undergo environmental assessments considering their effect on the climate, electricity infrastructure and neighbouring communities.
The Scottish government stopped short of permanently blocking data centre development. The pause is intended to establish where facilities should be built and how many Scotland can reasonably support.
That is different from saying none should ever be approved.
The Green Party in England has called for a wider moratorium on major new projects, with an exemption for smaller facilities serving local communities.
Leader Zack Polanski said ministers should “slam the brakes” on what he called energy-guzzling and water-guzzling developments.
Labour rejected that proposal, warning that a nationwide pause would damage employment, investment and national security. The full argument between Polanski and the government is covered here.
Data centres are now treated like essential infrastructure
Data centres were designated as critical national infrastructure in 2024, placing them alongside systems supporting water, energy and emergency services.
They store and process everything from emails and financial records to patient information and government data.
The designation allows the government to provide greater support during serious incidents and reflects the damage that a major outage or cyberattack could cause.
It does not remove the need for planning permission or guarantee access to water and electricity.
Ministers have also changed the grid connection process so strategically important projects, including AI data centres, can be prioritised over speculative applications that may never be built. The queue for transmission connections grew by 460 per cent in six months, according to the government.
The political pressure is obvious. Britain wants the investment and computing capacity associated with AI but is trying to add that demand to an electricity network already facing long connection delays.
OpenAI itself paused work on its flagship Stargate UK data centre project earlier this year, citing regulatory uncertainty and high energy costs. The company said it remained committed to Britain but needed conditions that supported long-term infrastructure investment.
Is ‘nimby’ a fair description?
Some opposition to large developments will always come from people who simply do not want them nearby.
But describing the entire argument as nimbyism is too convenient.
Questions about whether a region has enough water, whether its electricity network can cope and whether local people receive any lasting economic benefit are questions for planning authorities and government.
The stronger case for data centres is not that communities should stop objecting. It is that the government should identify suitable locations, require companies to publish credible water and energy plans and ensure that the promised investment produces benefits beyond the construction period.
Britain cannot operate a modern economy without data centres. It also cannot build unlimited numbers wherever technology companies find land and power cheapest.
Osborne is right that refusing every development would leave Britain more dependent on the United States.
His critics are right that “sovereignty” does not answer what happens to a community’s water supply, electricity network or landscape.
The real choice is not between building everything and building nothing. It is whether Britain creates an AI infrastructure strategy before the scale of the building boom makes that decision for it.
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