Alan Mak: We must boost Britain’s energy grid to make us a ScaleUP nation

Alan Mak is a former Treasury and Business Minister, former Shadow Science & Technology Secretary, and Conservative MP for Havant.

Britain must continue to strengthen our position as a world leader in AI and tech. Thanks to the Conservatives we already lead Europe in AI startups per capita and, globally, we’re third only to the US and China. AI – projected to add $15.7 trillion to the world economy – will be in this century what coal and the steam engine were to the Industrial Revolution. 

The countries that master AI and other advanced technologies will secure the same kind of prosperity and international influence that Britain had in the 19th century. This position of pre-eminence will only be achieved, however, by ScaleUp Nations – countries that turn great startups into scaleups, global champions anchoring jobs, innovation and investment at home not abroad.

Our strengths in research, innovation and entrepreneurship, and our global outlook, make us uniquely placed to shape the next industrial revolution. From AI and quantum computing to advanced manufacturing and life sciences, Britain can lead the world. As Shadow Technology Secretary, I championed Britain becoming a ScaleUp Nation, become world-leading alongside China and the US, and ahead of our competitors in Europe, Asia and the Middle East. 

This ambition must be matched with action, especially when it comes to energy. We cannot expect the digital economy to be built on warm words alone. We must provide the grid infrastructure needed for Britain’s AI revolution to flourish. 

Far too often businesses from multiple sectors are told they must wait years and sometimes decades just to connect to the grid, a wait time that makes it impossible to attract investment competitively and scale. 

The surge in demand for energy from AI computers, data centres, and subsequent increased electrification will add tens of terawatt-hours of new load to the grid within the next decade. This is the equivalent of several nuclear power stations’ worth of continuous demand. Yet our current network is already straining to meet today’s needs, let alone future increased demand. 

Just one new Microsoft data centre in South Wales will use 80 megawatts of power, enough to run a small town. The Government’s own forecasts say total data centre energy demand will treble by 2035. Without faster grid connections and cheaper power, Britain’s AI revolution will stall before it even starts. Our innovators are ready to build the future, but they can’t plug a 21st-century technology revolution into a 20th-century grid.

This lack of grid capacity is not only holding back AI and data centres, but also new housing, clean energy projects and industrial investment. Labour Ministers talk endlessly about Britain being a “science and technology superpower,” yet they have not taken enough action to modernise the power grid to help our country achieve that status.

To fix the grid and therefore lead the AI revolution and build a ScaleUp Nation, we need a realistic, pragmatic approach that works with communities and taxpayers. That means reforming the planning system and securing private investment to make sure the UK has a modern, flexible, smart grid that can power our industries of the future. 

Labour rhetoric on AI is grandiose, but their AI Growth Zones are low on substance, and in their current state won’t deliver on their lofty ambitions. Instead of focusing on grid delivery, Labour Ministers are chasing arbitrary targets. The Government’s ideological 2030 clean power target is not just unrealistic, it’s irresponsible. Forcing through a complete decarbonisation of the power system within five years is driving up costs, deterring investment and risking blackouts. By prioritising ideology over practicality, Labour are not attracting the private sector investment to finance grid expansion and better energy storage. That means higher balancing costs, wasted capacity and ultimately higher bills for families and businesses. Britain needs affordable, secure, cleaner power – not arbitrary deadlines that make energy more expensive and less reliable.

Inaction will drastically impact our ability to compete on the world stage. It will make investors think twice about the UK, concerned that our grid capacity cannot keep up with their growing businesses or that they will be unable to connect. 

The Conservatives know what is required. We turned the UK into Europe’s startup capital and we’re calling for measures to take the next step and become a ScaleUp Nation. For example, bringing forward the implementation of the Mansion House Reforms from 2030 will unlock billions in patient capital to invest both in high-growth AI companies, and the energy infrastructure needed to power them. 

We also need to streamline the planning system to allow energy infrastructure to be fast tracked.  Streamlining approvals, setting clear national priorities for grid connections, and giving communities a real stake in decisions would unlock further private investment and deliver new capacity without endless delay.

Britain can lead the new digital era. But to do so we must be honest about the challenges and practical about the solutions. Labour’s ideological dogmatism, short-termism and complacency are failing to deliver. Conservatives, in contrast, can set out a credible plan to build the infrastructure of the future, secure our energy system, and spread opportunity across the country.

We know that if Britain wants to lead the AI century and become a ScaleUp Nation, we need a grid built not for the last industrial revolution but for the next.