Sir Keir Starmer has overruled Ed Miliband by snubbing plans for a green energy plant in a major blow to the Energy Secretary’s net zero plans.
The Prime Minister has effectively closed the door on the construction of a
major hydrogen project on Teesside – believed to be backed by Mr Miliband – by deciding to endorse a rival tech development near the site, according to correspondence seen by The Telegraph.
The H2Teesside plan, proposed by BP,
would have produced so-called “blue” hydrogen that could have provided up to 10pc of the supply Mr Miliband has said Britain would need by 2030.
However, the plan clashes with proposals on nearby land for Europe’s largest data centre – backed by Teesworks, the public-private partnership supported by Tees Valley mayor Lord Houchen.
A letter to Lord Houchen from Peter Kyle, the Business Secretary, confirms that the Government is planning to designate the Teesworks site as an “AI growth zone”, a central plank of the Prime Minister’s plan to make Britain an artificial intelligence hub.
It describes the Teesworks data centre as “the cornerstone of the UK’s AI strategy” and states that Sir Keir’s AI adviser will join a group dedicated to the project.
The decision to designate the site an AI growth zone was made by the AI task force, chaired by Number 10.
“The Government will put its full weight behind Teesworks and Teesside International Airport becoming an AI growth zone,” the letter says, adding that ministers will push major AI companies to invest in the project.
The letter is due to be published by the Planning Inspectorate on Friday as part of a review of the hydrogen project. Last month Mr Miliband delayed a decision on it until the end of October “to allow time to request further information”.
The data centre and hydrogen plant projects are on overlapping plots of land and planning documents have stated that they are incompatible.
The Cabinet row over the decision has been seen as a test of Labour’s commitment to its
net zero plans, which threaten to clash with the Prime Minister’s hopes of being a world leader in AI and attracting overseas investment.
Mr Miliband has the power to grant the hydrogen project a development consent order – a right to forcibly buy land off local property owners.
The Telegraph revealed last month that the Department for Science, Innovation and Technology had drafted in legal advice in the event that Mr Miliband granted the order. The Energy Secretary instead delayed the decision, keeping both projects in limbo.
BP has said it remained committed to the project and that it remained in talks with the Government.
It has admitted that it does not have a primary customer lined up for the hydrogen plant but has said the project should not be blocked by “speculative development”.
Sir Keir is keen to show he is committed to Britain’s AI goals, which are expected to be at the centre of a “technology partnership” agreed with Donald Trump, the US president, next week.
The Teesworks site has the potential for a data centre with more than a gigawatt of computing power, which would make it Britain’s largest site and potentially turbocharge hopes of developing and running advanced AI systems in Britain.
Mr Kyle’s letter, sent earlier this year before his recent replacement as Technology Secretary by Liz Kendall, stated that the Teesside AI growth zone would deliver “the sovereign AI capability that will secure the UK’s place as a global leader in this technology”.
A government spokesman said: “Any infrastructure decision this Government makes will be in the national interest – helping deliver the Government’s Plan for Change.”
Lord Houchen has said that Britain “cannot afford to dither and delay” if it is to compete in the global AI race.
In a letter to Mr Miliband in August, he said the hydrogen plant would have a “sterilising effect” on the AI growth zone plans.
Lord Houchen wrote to Michael Shanks, the energy minister, last week to say that H2Teesside remained in discussions with the Government and that no decision had been taken.
www.telegraph.co.uk
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