A landmark High Court challenge to a proposed £1bn data centre development beside the M25 motorway has thrown a harsh spotlight on a fundamental flaw in Britain's ambitious strategy for building out AI infrastructure. The case revolves around power-hungry projects being effectively approved before there is any certainty about where the electricity to run them will actually come from.
Government Concedes Flawed Planning Assumption
The government has now formally accepted that planning permission for a massive 90-megawatt hyperscale data centre facility at Iver in Buckinghamshire should be quashed. Officials admitted the permission was originally granted based on an assumption that low-carbon energy solutions could be secured at a later date. This assumption, they have conceded, was fundamentally flawed.
This significant admission clears the path for the first full legal challenge to a hyperscale data centre project in the United Kingdom. It simultaneously raises profoundly uncomfortable questions about the sustainability of the UK's current AI infrastructure boom, particularly regarding how power demands are assessed and guaranteed.
Power and Environmental Scrutiny Intensifies
The specific scheme, proposed by developers Greystoke Land and Altrad UK for a former landfill site, was initially rejected by Buckinghamshire Council due to green belt concerns. However, it was subsequently waved through on appeal by central government planning inspectors.
Those inspectors acknowledged the project would have substantial landscape and environmental impacts but concluded these were outweighed by the pressing national demand for data centre capacity. They also decided a full environmental impact assessment was not necessary—a judgement now facing intense pressure.
Campaigners argue that ministers failed to properly evaluate the enormous electricity and cooling demands required to operate modern AI workloads. They claim the approval relied on promised mitigation measures that were never formally locked in or guaranteed.
In a revealing letter to the court, government lawyers accepted that relying on the future sourcing of low-carbon power without concrete guarantees constituted a "serious logical error". This admission exposes a core tension within the UK's broader energy and industrial policy.
A Wider Risk for UK Tech Investment and Ambition
This legal challenge emerges at a critical juncture, as data centre development accelerates rapidly across the UK. Planning applications for such facilities hit a record high last year, with investors scrambling to secure land for compute capacity, particularly in London and the South East.
However, power availability is increasingly becoming the binding constraint on this growth. Large, AI-focused data centres require tens of megawatts of continuous, reliable electricity, alongside significant cooling infrastructure. Grid upgrades to support this demand can take many years to complete.
Consequently, developers are often forced to make optimistic assumptions about future energy solutions simply to keep their projects moving forward. This High Court case strongly suggests those assumptions may now face far tougher legal and regulatory scrutiny.
Uncertainty for Developers and National Strategy
Developers and investors now fear this ruling could set a precedent, aggravating legal challenges to other projects. This could slow down vital infrastructure rollouts and inject significant uncertainty into the market at the very moment Britain is actively pitching itself as a global hub for artificial intelligence.
Furthermore, the case highlights a stark contradiction at the heart of government policy. Ministers are publicly championing faster approvals for critical AI infrastructure to boost economic growth. Yet the courts are signalling that this desired speed cannot come at the expense of credible, evidence-based energy planning and proper environmental safeguards.
The outcome of this challenge will therefore have ramifications far beyond a single site in Buckinghamshire. It tests the robustness of the planning framework supporting Britain's digital future and questions whether the nation's energy grid can realistically support its technological ambitions.
