Data Centres Enter the NSIP Regime

James Goldthorpe and Emyr Thomas explain the UK government facilitating data centre developments through the NSIP regime and how stakeholders, including host local authorities, can prepare.

As Wall Street and Silicon Valley debate whether there’s an ‘AI Bubble’, investment in the data centres powering the AI economy shows no sign of slowing.  Global spending is forecast to hit $3 trillion in the next three years, with up to 100 data centres planned for construction in the UK already. Against this backdrop, the UK government has moved to facilitate the consenting of data centre developments through the Nationally Significant Infrastructure Project (“NSIP”) regime.

In this article, Emyr Thomas and James Goldthorpe explain what this means and how stakeholders, including host local authorities, can prepare.

What are NSIPs?  

The NSIP consenting regime was introduced by the Planning Act 2008 (the “Act”) with the intention of speeding up the planning process for major infrastructure. To consent such projects, the Secretary of State – as decision-maker – will make a statutory instrument called a Development Consent Order (“DCO”). Often referred to as “super-consents,” DCOs grant planning permission and confer additional powers on NSIP developers. These powers can include compulsory acquisition, authority to alter or stop up highways, and powers which remove the need to obtain certain additional authorisations under other legislation.  The Act sets out a detailed process for DCO applications which are independently examined by an ‘examining authority’ (“ExA”) to a six-month timetable. After the ExA issues recommendations, the Secretary of State should make their decision on the project within three months.

The NSIP regime has been seen as advantageous to developers, offering predictable timescales, a ‘one-stop shop’ for authorisations and a national decision-maker unmoved by the political pressure of local opposition.

How will Data Centres be incorporated into the NSIP Regime?

Development meeting certain descriptions and thresholds must be consented via the NSIP regime.  However, the Act also provides a mechanism for prescribed categories of development to opt-in to the regime voluntarily. On 08 January 2026, a new set of regulations came into force which added data centres to the types of “business or commercial projects” which are able to opt-in to the NSIP regime in this way.

As such, promoters of data centre developments will be able to request a direction under section 35 of the Act to bring their project into the NSIP regime.  Such directions will be made where the Secretary of State is satisfied that the project is “nationally significant”.   In October 2025, a written ministerial statement confirmed that the parameters, thresholds and other factors used to determine whether a development meets this test will be set out in the forthcoming National Policy Statement for data centres.

Consultation on Energy Co-location Thresholds

Beyond these changes, the government is also consulting on whether further reforms are needed to ensure co-located energy generation projects and data centres can be consented under the same regime.

In a recent planning reform consultation, the government asked for views on whether changes to the system are required to create sufficient flexibility for both data centres and the energy generation projects which may accompany them to be considered in tandem via the same planning process (be that the TCPA or the NSIP regime in any given case).

This consultation exemplifies the complexity and scale of project which the government anticipates will come forward in the coming years.

How we can help

As large-scale data centre projects move into the NSIP regime, local authorities and other stakeholders will need to consider how they can best influence the planning process in a different forum.

Local authorities play a pivotal role in DCO examinations by producing the Local Impact Reports (“LIRs”) which the Secretary of State must have regard to when deciding applications under section 104 or 105 of the Act.

For any local authority hosting a major data centre development, the potential impacts of these huge projects are innumerable. For example, whilst headline investment figures are likely to be promising, the high-levels of automation prevalent in the sector mean that job-creation at the operational level may be fairly limited in practice without targeted intervention. The negative externalities of data centres – principally in the form of water and energy consumption – are also significant.

In this context, local authorities will need to play a crucial role in ensuring that DCOs and associated documents secure appropriate environmental mitigation for data centres coming forward under the NSIP regime.

Sharpe Pritchard’s planning and parliamentary team has extensive experience with all aspects of the NSIP regime, including pre-application matters, the DCO examination and a multitude of post-consent issues.   We have worked on some of the largest infrastructure projects in the country and developed an intricate understanding of the demands which NSIPs place on participants, including host local authorities, and how best to navigate them.