Data centre waste heat is already abundant and predictable. That’s why Simon Kerr, Head of Heat Networks at EnergiRaven, believes the UK needs joined-up regulation, heat zoning, and early planning engagement to capture it at scale.

As artificial intelligence, hyperscale computing and cloud services fuel an unprecedented expansion in the number of data centres, there is an accompanying increase in the amount of waste heat produced by digital infrastructure. Harnessing this heat could help the UK strengthen energy security and support decarbonisation, provided the right frameworks and infrastructure are put in place.

Each facility produces a continuous, predictable flow of heat which, with vision and planning, could contribute to urban energy systems, reduce reliance on gas for space heating, and support grid stability at a time of rising demand.

Today, much of this heat is treated as a by-product, expelled into the environment and lost. But with the right infrastructure, a larger share of it could be used to supply homes and public buildings, and to support local heat networks.

With careful policy and national planning, each unit of low-carbon electricity could deliver more value – for example, once in a data centre for computation and again through useful heat in nearby buildings.

Learning from Scandinavia and charting our own path

Looking to our Northern European neighbours, Denmark and Sweden are demonstrating that heat reuse can work. Data centre heat flows into city-wide heat networks, reducing heating costs, gas consumption and exposure to volatile fossil fuel imports.

These outcomes are helped by alignment between policy, finance, governance and planning, creating an environment where connection is expected, investment is bankable and energy systems are coordinated.

However, it would be naive to assume the UK can simply copy Scandinavia. The UK is different: local authority powers are fragmented, heat zoning is inconsistent, and there is no obligation to consider heat recovery. The UK must develop its own blueprint, one that reflects our geography, regulatory landscape and existing infrastructure, and decide which approach will deliver the most practical results for UK citizens.

With ambition, joined-up planning and predictable funding, the challenge of cooling data centres could also become part of a broader energy opportunity.

How can we make this happen?

To get to a networked UK – where waste heat from data centre clusters in Slough, West London, Manchester and Edinburgh is fed into local heat networks to support homes and businesses – planning reform should treat data centres as strategic national energy assets. Every new facility should assess heat recovery potential, and early engagement with heat network developers should become routine.

Regulation should bring waste heat into mainstream energy policy, requiring large producers to report on and evaluate options to act on their waste heat potential. This should be supported by clear guidance from Ofgem, DESNZ and local authorities. Predictable frameworks for connection, supported by heat zoning, would reduce uncertainty for operators and help communities plan around available supply.

Meanwhile, establishing long-term capital frameworks and heat-purchase agreements would provide the commercial certainty required to accelerate adoption. This would encourage operators to treat heat as a managed output—valuable where there is a viable offtake route and a clear investment case.

To tie this all together, our mindset as a nation must shift towards seeing heat itself as a utility. This is already underway, with Ofgem set to start regulating heat networks from January 2026.

The practical barriers in our way

Integrating a new energy source at national scale is a daunting task, but it is something we have done many times before.

There are a number of measures we can take to realise this vision. We can task a central body with providing guidance to local authorities to help them build expertise; mandate that operators engage at the earliest stages of planning to enable cost-effective integration; and ensure “lessons learned” are collected and shared widely among all stakeholders.

We don’t need to look far to find examples of communities making heat recovery and usage work for them. Shetland Heat Energy and Power (SHEAP) is one example: by recovering heat from a local waste-to-energy plant, residents have benefited from reduced exposure to energy price shocks in recent years. The UK can overcome these challenges, but only with clarity and ambition. Early alignment of policy, planning and investment can turn heat recovery from a theoretical possibility into a deliverable, repeatable model.

A practical opportunity for operators

For data centre operators, heat reuse can create an additional revenue line in the right locations and, importantly, support decarbonisation objectives. Recovered heat can reduce cooling loads, improve ESG reporting, and strengthen investor confidence where delivery is measurable and contractual.

Early collaboration with regional heat networks can also improve project economics by aligning technical design, connection requirements and commercial terms from the outset. The operators best placed to benefit will be those that plan for heat export early, particularly in areas with dense heat demand and credible network development.

Operators who engage now may be better prepared as regulation evolves. Heat supply could become a stronger factor in planning decisions over time; planning early reduces risk and helps avoid costly retrofits.

Why the UK must act now

The stakes are high. Reusing data centre heat can reduce household heating costs, enable urban heat zoning strategies, and cut national gas demand – while supporting a rapidly expanding digital economy. As AI and cloud computing drive energy demand, aligning digital infrastructure with energy planning is a pragmatic opportunity that can be captured where the technical and commercial conditions are right.

The UK has the chance to turn a by-product into a useful local resource. By combining long-term vision with practical action, we can support a future where digital growth and decarbonisation can progress in parallel. The heat is already there – the question is whether we have the foresight to use it.

Waste heat from the UK’s latest crop of data centres could be used to heat at least 3.5 million homes by 2035, according to new research that argues the country risks letting a major low-carbon heat source go unused without investment in heat network infrastructure.

The analysis, produced by heat mapping organisation EnergiRaven in partnership with Danish energy and sustainability consultancy Viegand Maagøe, links projected growth in data centres to a significant rise in recoverable ‘waste’ heat. It estimates that data centres could provide enough heat for between 3.5 million and 6.3 million homes by 2035, depending on factors including the efficiency and design of future facilities.

The research lands as the UK grapples with two parallel challenges: the rapid expansion of energy-hungry digital infrastructure to support cloud computing and AI, and the long-running difficulty of decarbonising heat – still dominated by gas boilers across much of the housing stock.

EnergiRaven argues that many existing and planned data centres are located close to proposed new towns and to communities facing higher levels of fuel poverty, raising the prospect of linking local heat demand with a growing heat supply that would otherwise be rejected into the atmosphere.

“Our national grid will be powering these data centres – it’s madness to invest in the additional power these facilities will need, and waste so much of it as unused heat, driving up costs for taxpayers and bill payers,” commented Simon Kerr, Head of Heat Networks at EnergiRaven.

“Microsoft has said it wants its data centres to be ‘good neighbours’. Giving heat back to their communities should be an obvious first step.”

How Manchester could be an ideal pilot

The report points to Greater Manchester as one area where this alignment could be particularly strong. It notes plans for around 15,000 homes at the Victoria North development and a further 14,000-20,000 at Adlington, alongside clusters of fuel poverty.

At the same time, the analysis highlights a concentration of data centre infrastructure around the city region, including more than a dozen existing sites and four additional facilities planned. EnergiRaven argues that, in theory, this proximity could make it easier to connect heat sources and new developments – provided heat networks are planned early enough, and built at sufficient scale.

More broadly, the research suggests the same pattern appears across the UK: growth in data centres is expected to increase the amount of recoverable heat, but the ability to use it will depend on whether networks exist to move that heat into nearby homes and buildings.

How heat networks work

Capturing waste heat typically requires a heat network: insulated pipework that transports hot water from a heat source to buildings, where heat interface units (HIUs) can replace individual gas boilers. The report notes that waste heat recovery is widely used across parts of northern Europe, particularly in Nordic countries, where major sources of waste heat — including data centres, power stations and other industrial processes — are more routinely integrated into district heating systems.

In the UK, heat networks remain a comparatively small part of the heating mix, but policy has been moving to encourage growth. Some cities have already been designated as ‘Heat Network Zones’, where heat networks are assessed as the cheapest low-carbon option for decarbonising heat locally.

Regulatory changes are also on the horizon. Ofgem is due to take over regulation of heat networks in 2026, and new technical standards will be introduced through the Heat Network Technical Assurance Scheme (HNTAS), intended to improve consumer protections and investor confidence.

The Government’s recent Warm Homes Plan also includes a target to double the share of heat demand met by heat networks in England to 7% (27 TWh) by 2035, with a longer-term expectation that heat networks could supply around a fifth of all heat by 2050. It also pledges £195 million per year through the Green Heat Network Fund to support heat network development.

However, EnergiRaven argues that current policy settings still fall short of what would be needed to take full advantage of large-scale waste heat from data centres.

“Current policy in the UK is nudging us towards a patchwork of small networks that might connect heat from a single source to a single housing development. If we continue down this road, we will end up with cherry-picking and small, private monopolies – rather than national infrastructure that can take advantage of the full scale of waste heat sources around the country,” Kerr added.

“We know that investment in heat networks and thermal infrastructure consistently drives bills down over time and delivers reliable carbon savings, but these projects require long-term finance. Government-backed low-interest loans, pension fund investment, and institutions such as GB Energy all have a role to play in bridging this gap, as does proactivity from local governments, who can take vital first steps by joining forces to map out potential networks and start laying the groundwork with feasibility studies.”

A “heat highways” argument — and what it would change

A central recommendation in the analysis from EnergiRaven is the need for larger, strategic networks – which it describes as ‘Heat Highways’ – capable of transporting waste heat over longer distances and linking multiple sources and demand centres. The report suggests that smaller, isolated schemes may struggle to exploit the growing scale of data centre waste heat, particularly as facilities cluster in certain regions rather than being evenly spread across the UK.

Viegand Maagøe’s Peter Maagøe Petersen argues that building larger thermal networks could also provide benefits beyond household heating, including grid balancing and energy security.

“We should see waste heat as a national opportunity. In addition to heating homes, heat highways can also reduce strain on the electricity grid and act as a large thermal battery, allowing renewables to keep operating even when usage is low, and reducing reliance on imported fossil fuels. As this data shows, the UK has all the pieces it needs to start taking advantage of waste heat – it just needs to join them together,” he noted.

“With denser cities than its Nordic neighbours, and a wealth of waste heat on the horizon, the UK is a fantastic place for heat networks. It needs to start focusing on heat as much as it does electricity – not just for lower bills, but for future jobs and energy security.”

The underlying message from both organisations is blunt: data centre growth is already being planned and powered. The question is whether the UK will treat the heat those facilities inevitably produce as a resource – or continue to design energy infrastructure that ignores it.