UK's National Grid Acquires Teesside Land for 3.2GW Substation to Power AI Data Center

National Grid has purchased more than 70 acres of land at Dorman Point in Teesside, in the north of England, from local public-private partnership Teesworks, as part of a plan to construct a new substation capable of delivering up to 3.2GW of capacity to serve a large AI data center development on the site of a former steelworks outside Middlesbrough. The land deal, completed last week, marks a significant step in the development of the substation, which forms part of National Grid's broader Great Grid Upgrade initiative aimed at reinforcing transmission infrastructure across the UK.

The move underscores the growing pressure on electricity networks to keep pace with the power demands of AI-driven data center projects, which are increasingly being sited at scale in designated growth zones. The Teesside site was selected last year as part of the UK government's AI growth zone program and has been described as the largest brownfield development in Europe, spanning approximately 500,000 square meters (5.38 million square feet). Teesworks is listed as the primary developer of the data center, and the site has reportedly attracted interest from major US data center operators including Google, though a preferred operating and investment partner has not yet been finalized. Balfour Beatty and utility firm Steel River Power have been linked to delivering the power works for the substation.

Matt Pearce, National Grid's head of land, said the land deal marks an "important step forward" in the new substation's development, adding that the company is "committed to working closely with our partners to progress the development as quickly as possible." The project previously faced objections from oil and gas giant BP, which argued the data center plan would hinder its attempts to build a hydrogen plant in the area; despite those concerns, the data center plan was approved last August, and BP subsequently scrapped its hydrogen project later that year.

The Teesside substation is the latest in a series of grid infrastructure investments National Grid has announced to meet surging electricity demand from the data center sector. In November last year, the company commenced upgrade work at its Didcot substation in Oxfordshire to support data center growth in the region, and it has also begun construction at its Uxbridge Moor substation in Buckinghamshire, which is expected to supply electricity to more than 12 new data centers and will become the largest substation in the UK when completed, with a target date of 2029. The scale of the 3.2GW Teesside project reflects how transmission operators are being forced to front-load major grid reinforcements years ahead of actual data center load coming online, a shift that carries significant implications for construction timelines, permitting, and the overall pace at which AI infrastructure can be deployed in the UK.