In what has been seen as an acknowledgement of the fundamental importance of data centres to the functioning of the UK economy and society, the UK Government has acted to designate data centres as ‘critical national infrastructure’ (CNI). In the first designation of its kind for almost a decade, the move places physical data centres and cloud operators in a framework alongside other critical infrastructure including energy supply and water supply.

What is the practical change?

In practice, the CNI designation will permit the Government to provide deeper support to data centre operators in anticipating and recovering from critical incidents, including:

1. establishing a Government-sponsored CNI data infrastructure team, tasked with monitoring and anticipating threats;
2. increasing operators’ access to security agencies (including the UK National Cyber Security Centre); and
3. in the event that an incident does arise, coordinating access to emergency services.

Why has this been done?

There are good reasons for data centres to receive this additional support, in view of the importance of data centres to the UK’s digital (and general) economy. The CNI categorisation recognises that a compromise in data centre security could result in “significant impact on national security, national defence, or the functioning of the state” (adopting terminology used by the National Protective Security Authority).

Additionally, the Government will likely be looking to this CNI designation as a further policy tool to boost investor confidence in the asset class, providing favourable conditions for private sector investment in the sector. The Department for Science, Innovation and Technology’s announcement calls out the move as boosting the resilience of the sector and providing “greater reassurance the UK is a safe place to invest in data centres”.

How does this sit alongside other recent measures?

Whilst operators will be keen to understand whether the CNI designation could bring with it an increased regulatory burden, this announcement can be seen in the context of other policy moves designed to establish a stable platform for data centre investment in the UK. 

As we have noted previously, parallel reforms are underway to smooth the path to increased digital infrastructure development, including planning reforms and streamlining rights of judicial review. 

These reforms, when aggregated, certainly point to an intentional policy focus on further boosting homegrown and inbound investment in the UK’s data centre sector, building on the momentum of a series of eye-catching UK data centre announcements in 2024.