Drax runs Britain's largest power station, in North Yorkshire. It plans to build an AI data centre there with Brookfield and Radiant, Brookfield's UK-based AI infrastructure business. The site could eventually host more than 1GW of computing capacity, Drax said in a stock market statement on Tuesday.
Brookfield estimates the total investment could top £20bn ($26.8bn), including chips. An initial £2.5bn would go into the first phase, which targets up to 100MW from early 2028. The money would come through a joint venture between Brookfield and Qai, a subsidiary of the Qatar Investment Authority.
“Drax Power Station is one of the few UK sites that can provide large-scale reliable power directly to data centre customers by utilising existing and underutilised generation capacity,” said Drax CEO Will Gardiner.
Three phases, and a power plant behind the meter
The estate covers more than 1,000 acres, with about 4GW of grid access and 2.6GW of generating capacity. The first phase would take its power from the national grid.
A second phase aims to add another 500MW between 2028 and 2031. This time, Drax's own generators would power the data centre directly under a long-term contract. A third phase aims to add more capacity after 2031.
That plan needs the government's consent. Drax's subsidy contract for its biomass power runs from April 2027 to March 2031. It lets Drax ask to send up to 500MW to a data centre. The government and the Low Carbon Contracts Company would decide, weighing value for consumers, energy security and sustainability.
“This gets us into the data center space and phase two and three locks in the long term future of the Drax power station as part of UK energy system for another 50 years,” Gardiner told Bloomberg.
No customer yet
The first phase still needs planning permission, regulatory and grid approvals, a tenant and a final investment decision from each partner. Radiant will look for anchor customers before construction starts. Drax is also working with the grid operator to repurpose its 100MW connection, which was built for exporting power, Bloomberg reported.
Drax expects a public consultation to start this month. The partners plan a voluntary fund for nearby communities.
The government welcomed the plan in the partners' announcement.
“Investments like this will help pave the way to a new age of British reindustrialisation, creating good jobs in Yorkshire and delivering growth right across the country,” said Chief Secretary to the Treasury Emma Reynolds.
Long grid queues have delayed other UK data centre projects, Bloomberg reported. Microsoft reportedly quit Nscale's UK site in October.
The emissions question
Drax burns wood pellets and makes almost 5% of the UK's electricity. Analysts say it is the country's single largest emitter of carbon dioxide, The Guardian reported.
The UK does not count those emissions, because Drax says the trees that grow back absorb the same carbon. The government has said Drax will play a “much more limited role” in future. Its subsidies will be halved from 2027 to 2031, The Guardian reported.
The government had rejected an earlier bid for the site, DatacenterDynamics reported. North Yorkshire Council, the University of York and Drax had proposed up to 1.2GW there as an AI Growth Zone. Britain is also debating whether to pause new data centres. Operators say power and labour are now their bottleneck.