Why Do Local Authorities Need a Data Centre Strategy?

Anna Stewart sat down with FarrPoint’s experts— Andrew Muir, Alan Pritchard and Matthew Izatt-Lowry — for the new 'Consultants in Conversations' feature discussing why data centres are vital infrastructure.

Let’s get into it…

With data centres becoming critical infrastructure, I want to discuss why local authorities should have a data centre strategy?

Andrew, let’s start with you. Why is this an important topic to discuss now?

Andrew: Thanks, Anna; I would say because data centres are part of the UK’s critical infrastructure and are at the heart of everything we do online. Every aspect of our lives—from healthcare to education, commerce to entertainment—relies on them. With the exponential growth of AI & data, local authorities need to plan for how to manage and accommodate these facilities effectively. Without a strategy, they risk being unprepared for the economic and environmental challenges that come with hosting or supporting data centres.

Ok, so what would you say local authorities should consider when developing a strategy?

Alan: I’ll start us off here. There are several things. Firstly, location is crucial. In the UK the industry is currently centred around traditional hubs within and around the M25 but is expanding to other areas, driven by the need for resilience plus critical availability of power, water and sites. Secondly, engagement with the private sector is key- collaboration ensures local needs like infrastructure and environmental considerations align with other strategic national benefits.

Matthew:  I totally agree – Alan is spot on, and I’d add the economic angle. A well-thought-out strategy can help attract inward investment, create jobs, and support local innovation. However, the economic benefits go beyond direct employment. For example, data centres enable digital industries and provide the backbone for AI, cloud computing, and e-commerce. It’s about creating a virtuous cycle where infrastructure supports economic growth and vice versa.

Andrew: To build on what’s been said, security and resilience are now top priorities. With data centres designated as critical national infrastructure, local authorities must ensure these facilities are protected and resilient against risks like cyber threats or power outages. Diversifying their locations—moving away from a concentration in one region—also supports national resilience.

Okay, so it sounds like location, collaboration, and resilience are key pillars. What about sustainability?

Alan: Sustainability is fundamental. Data centres consume a lot of energy, and this is increasing with the push of AI, therefore access to renewable power is vital. Brownfield sites—those previously developed—should be prioritised to minimise environmental disruption. Plus, innovations like using the heat generated by data centres to supply to nearby homes and businesses provide additional benefits.

Matthew: Though, as exciting as heat reuse sounds, it’s not straightforward. The heat generated is often low-grade and difficult to repurpose, with particular challenges around replacing heat and power distribution networks. But integrating data centres into the planning of new developments—like smart cities—opens up opportunities for more energy and carbon-efficient solutions.

But surely there are challenges to all this?

Andrew: Definitely. The main challenge is balancing the costs at the local level, with the benefits often felt at a national level. Local communities might be concerned about energy use, environmental impact, noise or even visual aesthetics. That’s where good communication and strategic planning come in—to highlight the broader benefits and ensure developments align with local priorities.

Alan: And don’t forget connectivity. While power is a significant consideration, robust digital connectivity is equally essential. Data centres can’t function without reliable and very high-capacity telecoms infrastructure. That’s where our team at FarrPoint come in, helping map out those connectivity needs and opportunities.

What can FarrPoint offer in terms of support to local authorities in navigating these challenges?

Matthew: We provide end-to-end support. From helping authorities define their data centre strategies to conducting site selection and due diligence. We also evaluate business cases and assess the economic, social and environmental impact to ensure decisions are well-informed, and can maximise local social value.

Andrew: And we assist with regional promotion and communication strategies, ensuring local authorities can attract investment and community support.

Ok, to wrap up, what would be your key message for local authorities to take away from this discussion?

Alan: Start engaging with the data centre industry now. Ask the right questions, understand your region’s potential, and plan strategically to harness the economic and digital benefits.

Matthew: Yes, and look at the bigger picture. Data centres aren’t just physical facilities—they’re enablers of the digital economy.

Andrew: And remember resilience and sustainability. A balanced approach will position local authorities as leaders in this essential sector. And if you're stuck at any point, FarrPoint is here to guide your organisation through the process and ensure it's the right approach for your region.

Anna: Thanks, everyone! It’s clear that data centres are more than just infrastructure; they’re foundational to the economy and our digital future. Local authorities need to act now to stay ahead.

Interested in what FarrPoint has to offer in terms of Data Centre Consultancy?

We advise both public and private sector organisations on a variety of subjects from site selection and reviews to local data centre strategy. Visit our services page to find out more.