National Grid buys Teesside land for Britain's biggest substation to power planned AI data centre

National Grid Electricity Transmission last week signed a deal to buy more than 70 acres (29.5 hectares) of land at Dorman Point on the Teesworks site in north-east England, paving the way for Britain's biggest electricity substation, Sky News reported on November 1. The substation would provide power to a vast neighbouring data centre that sources told Sky was likely to be the largest in Europe.

The site has drawn significant interest from US-based frontier AI labs and technology hyperscalers in recent months, and competition for it is likely to lead to an investment decision with a preferred partner in the coming months, according to Sky. "Securing this land agreement is an important step forward in the development of the new substation," said Matt Pearce, National Grid's head of lands, adding that it "will support the growth of AI and digital technologies and enable the region's next phase of industrial and economic development."

National Grid's project page describes the Tees Dock substation as a new 400kV facility contracted to provide over 1 gigawatt of import and export capacity, supporting a proposed private-wire network serving a new data centre alongside a battery storage site. The company submitted an outline planning application to Redcar and Cleveland Borough Council in September, plans a public consultation on detailed proposals in spring 2027 and, subject to approvals, expects land remediation and construction to begin from autumn/winter 2027. The project is part of its Great Grid Upgrade programme.

"Everyone who has tried to build a data centre in this country knows the biggest problem is getting enough power to the site quickly," Tees Valley mayor Ben Houchen said. "Having up to 3.2GW of capacity here means we can finally compete for those projects." The Guardian noted that the government last week published a draft national policy statement describing data centres as "as fundamental to our economy as the railways and electricity networks," even as rapid data centre construction faces local opposition in parts of the UK over pressure on power and water.

Sky reported that London-listed Balfour Beatty was in line to deliver the substation, with Steel River Power, which runs the private electricity network across the estate and is part-owned by Iberdrola's North West Electricity Networks, also heavily involved.

Sources: Sky News (via Yahoo Finance UK), The Guardian, National Grid. Image: Sky News