Farmland sites on radar of data centre developers

Aside from housing, the next big development pressure on farmland is likely to be for data centres.

These warehouses filled with computing infrastructure provide the physical location for storing digital information and the equipment to power web platforms and services, many of which are “cloud” based.

The rapid development and use of artificial intelligence (AI) has ramped up demand for capacity.

Amazon Web Services said last week that it would be investing £8bn over the next five years in building, operating, and maintaining data centres in the UK.

See also: What’s behind the rise in farmland sales in 2024?

Easier planning

Relaxing planning laws is one of the government’s stated policies in its drive to boost economic activity, and data centres are in its sights (see “Planning changes ahead”).

Soon after the election, Angela Rayner, deputy prime minister and secretary of state for levelling up, housing and communities, pledged to make it easier to build laboratories, gigafactories and data centres, along with electricity grid connections. 

She will also decide on two data centre planning applications that were refused in Buckinghamshire and Hertfordshire. Data centres are also to be designated critical national infrastructure.

This terms them national assets that are essential for the functioning of society, alongside the existing categories of chemicals, civil nuclear, communications, defence, emergency services, energy, finance, food, government, health, space, transport and water.

© istockphoto/Andrey Semenov

Power needs

Aside from land, the prime requirements of data centres are large amounts of power and a fast fibre internet connection. They also need large volumes of water for cooling.

The power requirement can be anything from 30MW to 300MW, says Neil Johnson of data centre adviser and project managing real estate firm CBRE.

Farmland sites could bring processing power closer to customers in some cases, he says, in the form of smaller, more bespoke data centres.

National Grid says that data centres accounted for 2.5% of the UK’s electricity consumption in 2022. This is expected to multiply six-fold over the next 10 years.

With the state of the UK’s creaking grid, this presents problems which can sometimes be partially overcome by locally generated renewable power, which also ticks sustainability boxes, say advisers.

Polly Sewell of Bedfordshire and Buckinghamshire land agent Robinson & Hall is working on private wire deals to provide data centres with power from solar projects based on farmland.

Arrangements such as these can often offer a better return than “traditional” solar projects.

Some advisers suggest that farmland sites could have an advantage over others as they could offer better physical security for data centres.

This is due to their locations being potentially less vulnerable targets than those closer to major settlements in times of civil or other unrest.

At Bidwells, planning partner Rob Hopwood says: “There’s a lot of positivity around data centres and some big deals.”

However, the government is playing catch up regarding both grid and planning, he says: “It’s chicken and egg, is it planning first then grid, or connection then planning?”

His colleague Giles Dobson acted for the landowner in a 34ha data centre site near Elstree, Hertfordshire recently and says that the most important consideration is power, with relatively flat land needed, in one block.

Website datacentermap.com lists 367 data centres in the UK, stretching from Aberdeen in the North East to Exeter in the South West and Kent in the South East.

While the pressure for data centre development has been concentrated in the South East, Rob explains they are needed everywhere. “Nothing is out of bounds,” he says.

In some cases, the water and cooling requirement may even be addressed by siting projects underwater, which is being researched.

For many data centres, latency is an issue – this is the amount of time it takes for data to transfer across a network.

Low latency (high speed and low delay) is a pre-requisite in many cases, but less so in others.

Different models

Aside from the data centre services provided to businesses by the giants like Amazon, others serve more local needs, being sited closer to the customer’s own business.

Customers can also buy what is known as co-located space in data centres, effectively renting space in an established, secure location.

An example of this is a site recently launched by German retailer Lidl, which is offering businesses the ability to operate their own IT hardware in two of the group’s data centres.

In its 2024 half-year report, CBRE said that available  data centre space in London was at its lowest point in six years, due to  high demand.

Also, lack of available power and appropriate land are making it difficult for providers  to build new data centres.

Global data centre growth

Farmland is being taken up globally by these operations, with the purchase of more than 364ha in Indiana recently by Microsoft.

A 174ha site was also announced recently in Denmark. This will include heat reuse in greenhouses for vegetable production and heating for local communities.