Drax unveils plan for data centre at Selby power station

An energy company has said its Yorkshire site will get a new data centre to help it “contribute to the growth of AI”.

Drax announced plans to expand its power station near Selby with a new 100MW data centre, which could be operational by 2027.

A spokesperson said the centre would be part of Drax’s plans to allocate up to £2bn towards investment in flexible and renewable energy.

They added that further details were yet to be finalised and no planning application had been submitted.

Russ Mould, investment director at AJ Bell, said Drax was making the most of the opportunity to benefit from AI.

“The company has unveiled proposals to repurpose existing infrastructure and grid links at its Yorkshire power station to make its own contribution to the growth of AI,” he said.

“Once fuelled by the coal which was central to the industrial revolution, upgraded infrastructure will be utilised to run a data centre as part of the latest phase of technological advancement.”

The news came as Drax gave a trading update saying it expected earnings to be at the “top end” of market forecasts after a “strong” performance this year.

The fim said trading was boosted by the performance of its flexible generation, pellet production and biomass operations.

It told shareholders that full-year adjusted earnings would be “around the top end of consensus estimates” for 2025 after a positive second half of the year.

Chief executive Will Gardiner said: “Aligned to the UK’s future energy needs and underpinned by a strong balance sheet, good cash generation, and a disciplined approach to capital allocation, we are working to maximise the value of our existing portfolio, while driving growth over the short, medium and long term.”