The Drax Data Centre Plan In Yorkshire And How Will It Affect UK Energy

Ever wonder where all your TikTok videos, online game saves and photos actually live? They are stored in huge buildings called data centres. One of the UK’s biggest power companies, Drax, has just announced major plans to build a new one in Yorkshire, signalling a significant shift in the UK energy landscape. It is a move that links AI, cloud computing, national investment and even future household bills.

First things first, what is a data centre?

A data centre is like a giant digital library. Instead of shelves of books, it contains thousands of powerful computers called servers. These servers store, process and move all the information that powers modern life, from streaming films to sending messages. This requires enormous amounts of electricity and cooling, running nonstop every day of the year.

This is where Drax comes in. The company sees an opportunity to use its existing energy infrastructure to power a brand new data centre at its well known site in Yorkshire. The rise of AI and cloud platforms means demand for electricity is skyrocketing, and Drax wants to be at the centre of that growth.

From coal power to cloud power in Yorkshire

Drax power station was once one of Europe’s largest coal plants. Today, it is undergoing a transformation for the digital era. Drax plans to repurpose existing grid connections and infrastructure to support the new data centre, aiming to have it operational by 2027. It is a smart reuse of facilities that once powered the industrial age.

This kind of industrial development is happening across the UK. Projects in places like Immingham and Teesside, such as the BP hydrogen scheme, show how energy and technology plans often overlap or clash. For Drax, this expansion marks a strategic step into the future.

Russ Mould, investment director at Drax Data Centre Investment: UK Energy Growth Boost?, explained the shift well. He said the project shows Drax sees a clear opportunity in meeting AI’s huge energy needs and is evolving from a coal powered past to a tech powered future.

The money side of things

Drax chose to announce the data centre at the same time as releasing strong financial results. The company expects to hit the top end of earnings forecasts for 2025 thanks to its biomass operations, pellet production and flexible power generation. In simple terms, business is booming.

That financial strength gives Drax confidence to invest heavily in new ventures. Here are the key numbers.

• £3 billion in expected free cash flow from 2025 to 2031, available for new investment projects.
• £2.3 billion in contracted power sales already secured through the first quarter of 2027.
• £2 billion in potential funding for more renewable and flexible energy developments.

Drax Group CEO Will Gardiner said the company plans to use this financial momentum to support projects that improve energy security, data infrastructure and renewable power, creating long term value for both investors and the public.

A bigger picture for UK investment

The new Drax project connects to a larger national push for energy innovation and economic growth. Across the UK, investment summits and government partnerships are helping to fund projects such as battery storage, wind power supply chains and advanced energy technologies.

At the Wales Investment Summit, for example, a £200 million battery storage project was confirmed, alongside plans expected to create thousands of jobs. Meanwhile, work continues on new tech for electric vehicles and satellite communications.

All of this investment is designed to strengthen the energy grid and support modern technology, but it also raises questions about future household bills as infrastructure upgrades become more widespread.

It is not all plain sailing

Even with strong financial results and ambitious plans, Drax is still under scrutiny. The company is being investigated by the UK financial watchdog following allegations about how it sourced the wood used in its biomass operations. This could affect public trust and long term strategic plans.

Russ Mould noted that although Drax shares have started recovering, concerns remain around its biomass strategy, subsidies and the environmental impact of burning wood pellets. These issues continue to shape the public conversation about the company’s future.

The transition from coal power to cloud power might be exciting, but it is also complicated. Drax’s plans for a Yorkshire data centre show how energy, technology and environmental responsibility are now tightly linked. The next few years will determine whether this move becomes a major win for the UK’s digital and energy future.