What does the new NPPF mean for data centres?

Last year the Government updated the National Planning Policy Framework (the NPPF) in order to bolster the construction of data centres, by introducing a requirement for local planning authorities to identify suitable locations for data centres and creating an avenue for development via its new grey belt policy (which we discussed here and here).

The Government has now launched a consultation on further proposed reforms to the NPPF. The reforms maintain the above - with draft Policy E1 requiring development plans to allocate sites for data centres where a need exists or is anticipated. 

However, the reforms go one step further. Draft Policy E1 also requires development plans to take into account AI Growth Zones. Last year the Government launched its AI Opportunities Action Plan (which we discussed here) setting out its intention to establish these AI Growth Zones - being geographic areas where a strategic approach would be in place to encourage data centre construction. In November the Government issued a policy paper on AI Growth Zones, setting out more concrete designs for these zones. The Government intends to: 

• reduce electricity costs and accelerate grid connection times for AI Growth Zones, for example by removing speculative demand in the queue (which we discussed here);
• streamline the consenting process, with the Government exploring whether consent timelines can be cut to 12 months for those larger projects that use the Nationally Significant Infrastructure Project regime; and
• assist local planning authority capacity, by creating a national team of AI data centre planning experts who will provide both direct advice and grant funding to local authorities considering data centre applications. 

The draft NPPF also proposes to include data centres as “essential infrastructure” in the flood risk vulnerability classification and acknowledges the need to co-locate large scale generators and users of power (see draft policy E2). Grid connections and the shortage of power supply are acute commercial issues for everyone in the DC sector investors. We anticipate the Government will consider this in more depth in its forthcoming consultation on a new National Policy Statement for data centres, which the NPPF consultation paper advises will be with us shortly.

Whilst the proposed NPPF reforms are a step in the right direction, we question whether the Government’s push for these “AI Growth Zones” (and the need for the NPPF to take them into account) will truly generate the domestic data centre delivery it seeks. The Government’s view is that AI Growth Zones are “pivotal” to achieving data-centre buildout by establishing locations which would allow investment into data centres to be clustered, whereas in reality there are various different types of data centre (edge, co-location, AI etc), each with their own locational requirements, and ultimately it is the customer (i.e. the end user of the data centre, such as Google or Microsoft) who will be driving where data centres are located. 

The consultation closes on 10 March 2026 and you can respond here.