01 December 2025

The proposed amendments to the Infrastructure Planning (Business or Commercial Projects) Regulations were approved by the House of Lords last week, following earlier approval by the House of Commons in November. These regulations, which still require formal approval by the Secretary of State before coming into effect, aim to give data centre developers the right to request that their projects be considered as ‘nationally significant infrastructure projects’ (NSIPs) for the purposes of planning consent.

Robbie Owen, a partner and head of infrastructure planning at Pinsent Masons, welcomed the parliamentary backing, noting that the debates provided valuable insights into what the forthcoming national policy statement (NPS) for data centres might include and highlighted potential challenges for developers choosing the NSIP route. The NSIP consenting process, introduced in 2008 for energy, transport, water, and waste infrastructure projects, was expanded in 2013 to include certain business and commercial developments. Recently, the UK government announced plans to extend this regime further to include data centres, gigafactories, and laboratories, as part of its broader strategy to promote investment in digital infrastructure and AI development.

The government’s push to facilitate data centre growth aligns with its aim to foster economic growth through AI-enabled technologies. Alongside enabling individual projects to be processed as NSIPs, the government is also exploring ways to streamline the overall consenting process for these projects, including potentially reducing approval times from an average of 18 months down to 12 months. In its recent policy document on AI growth zones, the government indicated that it is considering further planning reforms to support faster delivery of such zones.

Prior to parliamentary approval, the draft regulations underwent review by the Secondary Legislation Scrutiny Committee in the House of Lords. The committee expressed concerns that the draft national policy statement, which would guide decision-making for data centre NSIPs, has yet to be published. In response, Baroness Taylor of Stevenage, representing the government, confirmed that a draft of the NPS for data centres is planned for release shortly after the regulations come into force. She explained that the document is still under development and will outline thresholds, parameters such as project size, and policy background, including the need for data centres.

Environmental sustainability features prominently in the forthcoming NPS. Baroness Taylor noted that environmental impacts — such as water and energy use, noise, land use, and visual effects — will be key considerations during project assessments, with statutory bodies like the Environment Agency and Natural England able to scrutinise proposals. The NPS will also include an environmental, social, and economic sustainability appraisal, considering potential impacts and mitigation measures to promote sustainable development.

The government has also hinted at possible future policies encouraging data centres to recycle excess heat generated during operation. Baroness Taylor acknowledged the significant heat produced by data centres and cited examples of successful heat reuse projects, such as heating local swimming pools and potentially supplying district heating to homes and hospitals. She emphasised that the government currently encourages but does not mandate heat recycling, leaving room for further interventions.

Robbie Owen highlighted that while parliament’s approval is a positive step, only a small number of large-scale data centres are likely to seek NSIP status, as most projects can typically be processed through local planning channels. The government’s recent policy document aligns with this view, stating that most AI-related data centres will be consented via standard local procedures, with only the largest projects potentially requiring NSIP approval. Owen also welcomed the confirmation that the NPS for data centres will be published for consultation by mid-February and that the government is considering designating data centres as ‘critical national infrastructure’ similar to low-carbon energy projects.