A British power company that has received £6.5 billion in biomass subsidies is preparing to turn part of its electricity infrastructure into an AI business, with Canadian investment manager Brookfield joining a proposed development that could attract more than £20 billion.
London-listed Drax Group announced the agreement Tuesday, with its most consequential feature being a provision in Drax’s existing UK government support contract that could allow up to 500 megawatts of generating capacity to supply a data centre before subsidies expire in March 2031.
That permission is not automatic as Drax must seek consent from the UK government and the Low Carbon Contracts Company, which will weigh consumer value, energy security, and sustainability.
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In April 2025, the UK Parliament’s Public Accounts Committee reported that Drax had received £6.5 billion in biomass support since 2002. The committee also questioned the strength of the system used to verify sustainable biomass sourcing.
The proposed investment introduces another commercial use for a power station whose next support contract runs from April 2027 through March 2031. Under that contract, Drax is expected to supply approximately six terawatt-hours of biomass electricity annually, equivalent to roughly 30% of the station’s annual baseload output.
Brookfield estimates the development could attract more than £20 billion, including semiconductor equipment, with £2.5 billion contemplated for the first phase.
The initial facility would provide up to 100 megawatts of computing capacity from early 2028, using electricity imported from the grid. A subsequent phase targets up to 500 megawatts of data-centre capacity between 2028 and 2031, potentially supplied directly by Drax generation through a long-term power purchase agreement.
Further expansion after 2031 could take the site above one gigawatt.
Drax contributes land, planning, and power infrastructure, including four gigawatts of grid access and 2.6 gigawatts of active generation. Brookfield’s Radiant platform would handle customer development and data-centre design, with investment backing through a Brookfield joint venture with Qatar’s Qai.
Brookfield is known for having been chaired before by Prime Minister Mark Carney until January 16, 2025. His public ethics disclosure identifies a blind trust and a screen restricting his participation in official matters involving Brookfield interests.
