Constraints on the grid mean that AI datacentres could squeeze out housebuilding if Government proposals are carried forward.

During the first half of 2025 the queue fir connection grew by 460 per cent, mainly from datacentre proposals, which the Government favours due to the potential for these projects to generate economic growth and jobs.

Groups including the Home Builders Federation have noted that delays to domestic connection would create an effective "moratorium" on new homes.

Ofgem has launched a consultation and call for input on Demand Connections Reform, last month and submissions will close on 13 March 2026 in order to ‘weed out’ speculative, or ‘zombie,’ datacentre projects.

The reform seeks to move to a "first ready, first connected" model for demand, but where projects offering the economic potential can jump the queue.

The idea to accelerate the building of critical national infrastructure in inarguable, but unless it includes housing the projects will push out homes at a time where there is a severe shortage.

The conclusions are expected in early 2026, with final decisions published this summer.

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