PMSI Insights: accelerating demand across the UK data centre market
The UK data centre market is undergoing a period of rapid expansion, driven by accelerating demand for AI and cloud compute. With multi-billion-pound hyperscale investment planned across the country, the market is entering a new phase of growth. PMSI shares its latest insights on the scale of upcoming capacity requirements and the implications for supply chains and investors
Our key insights:
- UK compute demand is expected to rise significantly, with DSIT forecasts indicating a ~3–6x increase in required data centre capacity by 2035, underpinned by both AI workloads and traditional IT demand
- Meeting this requirement will require substantial investment: PMSI modelling suggests UK data centre CAPEX could increase from ~£1bn in 2024 to an average of ~£3bn per year between 2026 and 2030
- Electrical equipment, including switchgear and UPS systems, represents the largest component of build costs, accounting for roughly 40% of total CAPEX, creating material opportunity across the supply chain
- While the UK remains a leading and relatively mature European data centre market, planning and power constraints in major FLAP-D hubs are intensifying, increasing investor interest in Tier-2 locations such as the Nordics and Iberia, which offer low-cost renewable power and favourable climate conditions