Ofgem has launched a consultation on plans to tackle speculative data centre projects in Britain’s electricity connections queue
The consultation is part of wider plans to ensure network capacity is used for projects that are ready and able to connect rather than those that don’t guarantee change.
Ofgem’s director for energy system design and development, Eleanor Warburton, explained: “Britain’s electricity demand connections queue has more than tripled in size in less than a year, and consumers should not bear the risks created by speculative projects taking up space in the system.
“The connections system must work for consumers and for the projects that are ready to invest, build and connect. Where speculative projects take up space in the queue, they can delay other schemes and create uncertainty about future network needs.”
The consultation forms part of wider plans to tackle speculative projects
The consultation forms a key part of Ofgem, DESNZ and NESO’s wider Demand Connections Reform programme, which is built around three pillars:
- Curate: to ensure only viable projects enter and remain in the queue
- Plan: to support government-led prioritisation of strategically important projects
- Connect: to accelerate physical grid connections
These reforms will help protect consumers, improve confidence in network planning and clear the way for viable projects to connect faster.
Speculative data centres play a huge role in the increase in energy demand
The proposals are aimed at tackling speculative data centre projects by securing scarce network capacity without any firm intention to connect, ensuring the queue enables investment-ready, viable projects.
The regulator’s proposals follow a sharp increase in demand connection applications, with contracted demand offers increasing from 41GW to 125GW between November 2024 and June 2025, driven largely by demand from data centre projects.
Ofgem is concerned that a significant number of projects in the queue may not ultimately proceed, potentially delaying viable developments and creating misleading signals about future network investment needs.
Helping projects secure quicker access to the grid
Since the introduction of wider connections reform measures, around 7.8GW of projects have been accelerated by an average of six years, helping to bring forward investment and enabling projects to connect much sooner than would otherwise have been possible.
Ofgem expects these reforms to have a similar impact on demand connections, helping ready projects secure timely access to the grid while freeing up capacity held by speculative applications.
Alongside the proposed fee, Ofgem is consulting on new data centre-specific queue management milestones that would require developers to demonstrate tangible progress through evidence such as financial capability, commercial maturity and procurement activity if they wish to retain their place in the queue.
Together, these measures are designed to ensure scarce grid capacity is used for projects that are actively progressing towards delivery, rather than speculative projects that may never connect.
“By helping projects that are ready to move forward and connect more quickly, these reforms can also support economic growth, bringing forward investment, enabling businesses to be built and expanded sooner, and ensuring the benefits of that investment are felt across the economy more quickly,” Warburton said.
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