Summary
- Government has announced £90m for new and upgraded heat-network infrastructure.
- Official policy explicitly identifies data centre waste heat as a potential network source.
- None of the announced awards is confirmed as a data centre heat-reuse project.
The Department for Energy Security and Net Zero has announced £90 million for new and upgraded heat networks, expanding the infrastructure through which waste heat from facilities including data centres could eventually be reused.
The funding covers new low-carbon networks and upgrades to inefficient existing systems across England and Wales. Government said more than 750,000 homes are expected to benefit from the wider programme.
None of the awards announced on 23 September is identified as a data centre heat-reuse project. The relevance to digital infrastructure lies instead in the network layer: government explicitly lists excess heat from data centres and factories as potential sources that can feed district-heating systems.
That distinction is important because waste heat cannot be reused at meaningful scale simply by adding heat-recovery equipment inside a data centre. There also has to be a nearby customer, pipe network, temperature strategy, commercial agreement, and operating model capable of taking the heat when the facility produces it.
The largest project announced is in London, where £41 million of support is intended to help develop a heat scheme serving 650,000 homes, subject to planning. Government said the project could eventually unlock around £5 billion of investment in local heat networks.
Other awards include £11.5 million for a network covering Bexley and Greenwich, £11.4 million for a Marble Arch scheme using the London Chalk Aquifer, £9.7 million for an extension in Bradford, and £3.9 million for an extension in Solihull.
Heat reuse depends on infrastructure outside the fence
Data centre heat reuse has become more prominent in European planning and sustainability discussions, particularly in markets where district heating is already established. The engineering proposition is simple at a high level: heat removed from IT systems is upgraded or transferred and then supplied to another building or heating network.
The practical system is more complicated. Data centre cooling temperatures, heat-pump requirements, pipe distances, seasonal demand, redundancy, maintenance windows, and commercial ownership all affect whether recovered heat can be used economically.
Network availability is therefore one of the limiting factors. A facility can produce large quantities of low-grade heat continuously, but without a heat customer or network close enough to receive it, the energy will still be rejected to the atmosphere.
The new funding follows wider UK policy moves around recovered heat. DataCentral has previously reported on the government’s treatment of waste heat in heat-network policy, which affects how recovered industrial and data centre heat can be classified.
The latest awards do not guarantee new data centre connections, but they expand and improve the physical network base into which future heat-recovery projects could connect.
Government has also allocated £13.3 million within the package to upgrade 76 inefficient existing heat networks, including work on leaking pipes, insulation, and heat-interface units. Those projects underline another operational point: heat reuse depends not only on obtaining a source but on maintaining distribution infrastructure efficiently over decades.
For future data centre projects, proximity to an established or planned network can increasingly form part of site design and planning discussions. The £90 million package expands that infrastructure, but individual data centre heat-recovery schemes will still need their own technical, commercial, and planning case.
