The main reason the US has been and is growing at twice the rate of the EU and the UK is its leadership in the digital revolution. The US has produced all the dominant western companies in software, mobile phones and pads, search, on line shopping, cloud storage, social media and complex chip production. The EU and UK just have to use these US services, and allow the US corporations to set up this side of the Atlantic to serve the customers.
Out of the EU the UK now has a bit less onerous regulatory regime than the EU for innovatory digital business, and has a growing cluster of smaller digital success stories which we need to build on. So I was dismayed to read recently that some in the UK government see the wish for large corporations to invest in many more large data centres in the UK as bad news. They apparently are arguing that these centres would require too much electricity and water which they do not want to supply so we should say No.
This is the ultimate madness. Far from saving the planet it just means we would need to link to overseas centres where the extra energy and water would still be used. If the government was serious about renewable power being able to answer all our problems they would get on and provide it by commissioning far more they have to date. If they were more realistic and worried about costs and reliability they will get on and put in some additional new efficient gas fired power stations alongside replacement nuclear for our soon to close stations and more wind and sun powered plant. Controlling migration properly would also help, reducing the number of extra people that will need power as well the extra business demand.
We are short of water which is also silly in a country with plenty of rainfall. New reservoirs are urgently needed for existing growing demand let alone for the new data centres. Just get on with it.
More data centre investment can drive more growth in energy and water supply. That is the way you grow a modern economy. Why stay limping along in the EU slow lane when we can join the new data super highway to prosperity?
February 25, 2026
Good morning.
Why create anything when all that will happen is that the government will tax it all from you.
I Dubai the level of Corporation Tax is 8% as opposed to our 19-25%. If you have transferable skills, why work here ?
What is being created here is a welfare dependent society. A society that, will be further managed via your carbon credit score. The EU and the UK do not want a modern functioning society. They want control.
February 25, 2026
Many ‘smaller digital success stories’ get bought out by a larger American company.
Otherwise, the creators move the business abroad anyway. This also applies to other types of business and has been a pattern over many years.
At least other European countries are more protective of their industries and don’t allow foreign buyouts. We prefer Selling England by The Pound.
February 25, 2026
Seems so but the welfare society is a doom loop that cannot survive, as ever more rich and hard working leave, the tax take declines and ever more claimants arrive often people working in the black market and in crime while claiming benefits too and that often criminal too!
February 25, 2026
7% of energy bills announces the energy regulator or just move to the USA and get 70% of them! Far more and better paid jobs there too and rather lower taxes..
Lots of ‘The government is opening lots of community NHS diagnostic centres” adverts is there some election coming? Is it legal to use tax payers money for such slightly disguised political adverts?
But London especially the transport system is littered with adverts for “The Mayor of London…” all done at public expense or transport users expense.
Not the actions of decent, nice and intelligent leaders! How are the action against the rape gang and those who turned a blind eye to it going?
February 25, 2026
Why? We have lousy politicians nowadays. Corruption (financial, moral, intellectual) amongst our elites and the complicit blob is endemic. The system will not produce better outcomes for ordinary people.
On our side of the Atlantic, the environmemtalist dogmas are entrenched so deindustrialisation is accelerating. In the US, corporatism has a stranglehold. They may lead in AI, but it doesn’t help most people. Like us, their growth rate of real medium income has dropped sharply over the past 25 years (it’s about a quarter of what it was).
Their system isn’t serving the needs of the majority well, and nor is our system. Tweaking AI rules here won’t change things for us. The malaise is so much deeper.
February 25, 2026
I’m not sure Data Centres are a good idea. Apart from the power and water they need, it’s likely they could soin be obsolete. As things progress they tend to miniaturies making large factory scale buildings unnecessary.
If they are built they would probably have their own SMEs for power, supplied from overseas because our government won’t give the go ahead for our own SMRs. Once again destroying manufacturing at the altar of Net Stupid.
We now appear to be giving Gibraltar to the Spanish as 2TK seeks to divert us if any overseas territories before being evicted from Westminster. Please, please let us be rid of these scoundrels.
Reply We would not be communicating on this website without data centres.
February 25, 2026
space needed for a given compute and storage capacity in data centres is shrinking massively over time. but the demand is also going up. as is the requirement for resilience which requires duplication. as is the demand for low latency which requires capacity closer to the end users. as is the demand for security and regulatory compliance, which often means trusted geography and jurisdictions.
February 25, 2026
So how do your reverse the flight of capital from the city and encourage the institutional investors to do as you request?
What practical steps are there?
There are some routes for the individual to directly support innovation such as VCT/EIS but it’s really the large players that will make the difference.
February 25, 2026
It’s clearly in Britain’s interests to support the digital AI revolution; the datacentres are a necessary evil but must be built here
The datacentres in particular will require vast amounts of juice; in America, where they have the same issues, Trump has refused authorisation for onshore solar/wind datacentre projects – he has demanded new coal and CCGT plant, alleging without evidence that they are more reliable, if much more expensive
The problem of datacentre cooling would seem to be impossible to solve; datacentres need vast amounts of clean cooling water. Unfortunately, there are almost no sources of clean river water here, everything is contaminated with sewage and the costs of cleaning it up mean that datacentre operators will build their plant in France or elsewhere in the EU. Or, if Musk has his way, they will be located in low-earth orbit.
We already have the dearest electricity in Europe thanks to our reliance on LNG gas-fired CCGT plant – building more will just make the situation worse. The recent successful AR7 renewables auction included a number of cheap onshore solar and wind projects, which will include battery storage facilities. The datacentres could be built close to these.
February 25, 2026
Have you not heard of companies like ARM and ASML?
Reply Yes, Have you not seen the relative size of 7 UIS giants compared to the UK/EU companies?
February 25, 2026
ah my specialist subject…
intellectual property protection is far stronger in the USA, this is a massive problem here
UK innovation does succeed but the founders always sell before it gets massive here, we should look at why
use of cheap imported tax subsidised ( foreign Ed) workers, encouraged by state treaties and social engineering, is far bigger proportion of the IT workforce in UK and Europe. this limits quality, innovation, and IP protection.
UK is still building new buildings with copper telco connections, everything should be optical fibre by default now.
many of our telco exchanges are full, and there is no place to expand them physically.
data protection regime and the whole ICO organisation are incompetent here.
FCA regime and organisation are incompetent here.
UK business is infested with class based prejudice, in the US it is a million times more meritocratic.
nobody will study computer science here because they can see all the jobs are being given to Indian imports.
so its not all power and water…
Reply Where are they putting in copper? Where I live we have fibre optic from BT’s competitors.
February 25, 2026
Not so sure about data centres, are they really the money makers. Data centres are usually dumped in places where land, energy and water are cheap. It costs next to nothing to carry the money making data in and out. So lay a load of concrete, install rows of servers, hire a few technicians and turn out the lights. I am not at all sure the dim wits who run government can make a net profit out of this.
While at it, the noble Lords might consider why data centres need so much water. The small numbers of technicians don’t wash their hands and use the loo that much. No, what happens is that water is a cheap way to dump heat from all that electricity poured into the data centre. Costed as industrial water use such a use is perfectly legal.
The real reason the USA is ahead of the UK and Europe is finance post WW2. Ably assisted by Parliaments here and in France and Germany. You might ask why they didn’t ride the computer and semiconductor booms. The real reason is size and serious money, we don’t have either. Way back a great Parliamentary committee decided that three computers would satisfy the UK’s needs so not much investment needed. Never made a right decision since.
Data centres are the start of the 4th wave of technology change, the parking of the wasteful energy consuming component of high tech on former industrial nations.
February 25, 2026
Good morning Lord Redwood
“The UK needs to back digital investment”, I read that differently probably, hopefully to how you intended it to be read. The inference being is that Government should get involved and interfere. The opposite is what is needed, no Government involvement. The right track for Government is to ensure a path is cleared and framework in place to permit the best of the best to reach it potential.
Government, Parliament even half believing only they have the knowledge and the wherewithal to ‘achieve’ is proven time and time again to be false, creating a false hope in very lame minds.
Half the problems the UK suffers wouldn’t be there if Parliament and Government hadn’t tried to put their own personal spin and direction on things to achieve a ‘look-at-me’ moment.
February 25, 2026
correct layers and layers of state manipulation, often pulling in different directions, costs a lot, is counter productive, and makes the country inefficient. the state should concentrate on protecting the borders, defence, and a minimal safety net for those in need. you could more than half the size of the state and only good would happen.
February 25, 2026
Take Parliaments desire for NetZero, its evolved into a personal ‘ego trip’. The infinite ‘free’ energy. Homes that are warm & cosy with no energy requirement. Transport free of petro-carbons. Parliament thought that only they could achieve though diktats, laws and banning. How dim-witted are they? You cant flick a switch and say we have decreed so it is done. That’s just personal ego and self esteem drunk on power.
The NetZero dream needs vast amount of money as yet an undreamed of amount of money. Parliament has demonstrated it has no concept of where money comes from how it is earned. To achieve this personal NetZero dream the first action was the knee-jerk dimwitted ‘I am the power, the lord’ action of cancelling all the UK’s known means to finance tomorrow. They killed their offspring, got deluded by power, for what? A cost burden increasing by the day, and the constant funding of other Nations for their own tomorrow. Every action by Parliament and its Government was to import, therefore post the UK’s main resource ‘money’ to foreign climes for it never to return. Parliament and its Government at every-turn because they know best precluded the opportunity for Great British ingenuity and ward work to participate.
Parliament, Government needs to get off its personal ego trip come back down to earth and recognise they are not the ‘doers’, they are the drain on society
February 25, 2026
“This is the ultimate madness.”
No, it’s communism, levelling everyone down to loin cloths, clubs and spears – except for the Party leaders and officials who will have luxury apartments in exclusive immigrant free enclosed suburbs, private jets, designer suits and glasses courtesy of their financial friends, armoured luxury cars and body guards.
February 25, 2026
What we really need is a way for voters to get rid of Starmer’s Gang without waiting for the Gang to deign to submit to voters in 2029 or, if they can manage to delay a general election as I am sure they are planning, some time later.
February 25, 2026
That’s disinformation of the worst kind from HMG and water companies.
We suffer from mismanagement of our water industry just as we suffer the same with our road network and our energy supply.
Incompetence is just too vague a description – HMG has been in violation of the basic requirement to keep us safe as regards food, energy, water and streets free of violence – and they have failed miserably!
Water companies are very keen, as are HMG to impose water meters – they provide a sweet fairy tale about why, but they deliberately do not mention that water meters are a requirement of net-0 – a part of the control mechanism. HMG and water companies want smart meters, in addition to net-0 requirements to use less resources, so that they can cut off our supply at a whim, to educate us against over-use, or when we’ve been politically incorrect.
All of this expensive nonsense should be halted and HMG/Utilities made to do their day job.