Solving the AI Energy Dilemma: Unlocking green gas networks to power AI at Pace

New report finds that green gas can deliver a faster, lower cost route to AI infrastructure whilst building capacity on the electricity grid.

A new report published by Stonehaven, and commissioned by Cadent, has warned Government that it will need to address the energy infrastructure gap if it is to deliver on its ambitious AI targets.

The Government has committed to increase AI capacity in the UK from 0.5GW in 2025 to 6GW by 2030, which Stonehaven finds could benefit the UK economy by an additional £2.94bn in annual GVA per gigawatt, supporting delivery of key sectors including health, defence and financial services.

However, energy infrastructure poses a significant risk to the realisation of these benefits. 6GW would amount to more electricity capacity than delivered by Sizewell C nuclear plant, once online. In addition to generation, there is increasing competition for electricity grid connections, with some being cited waiting times over a decade.

The report finds that green gas is well positioned to address these challenges by;

• Using existing gas grid infrastructure to deliver the scale of ambition
• Ensuring connections in 12-18 months, as is more typical on the gas grid, to speed up the delivery process whilst the electricity grid is reinforced
• Making AI data centres an anchor customer for biomethane, bringing down carbon intensity for connected homes and businesses.

Stonehaven indicates that biomethane can reduce lifecycle emissions by up to 70% compared with fossil gas and the UK has enough domestic resources to produce 50 TWh by 2030, well beyond the data centre requirement.

The report makes several recommendations to support this approach, including:

• Aligning energy planning with AI growth targets
• Removing barriers to scaling biomethane production in the UK
• Treating the gas network as an enabling infrastructure in the 2020s and 30s
• Enabling targeted anticipatory investment in gas networks.

Abby Sinclair, Senior Consultant at Stonehaven, said, "In many cases, gas networks are the only viable energy source for data centres looking to deploy in the UK today. If Government wants to deploy AI at pace, it will need to look again at how it plans for the future of gas networks, and how it supports decarbonisation through biomethane."

Howard Forster, Chief Operating Officer at Cadent, "We have already heard from several AI operators about how they see the gas network as a key enabler of their deployment, striking nine connection agreements with data centre developers recently."

"The gas grid is not simply legacy infrastructure, but a strategic national asset that enables the rapid deployment of AI infrastructure while electricity networks expand. Crucially, in biomethane, a low-carbon pathway already exists within that system. With 47 biomethane producers already connected to our network, we’re currently reviewing an additional 38 applications for new or expanded UK plants, showing the opportunity to support this critical growth sector is readily available."

Download the full report.