Prime Minister Sir Keir Starmer has rejected plans for a major hydrogen plant on Teesside, dealing a blow to Energy Secretary Ed Miliband’s net zero strategy.
Instead, the Government has thrown its support behind proposals for Europe’s largest data centre on the same site, designating it an “AI growth zone” central to Britain’s artificial intelligence ambitions.
The hydrogen scheme, known as H2Teesside and proposed by BP, aimed to produce blue hydrogen that could supply up to 10% of Britain’s needs by 2030. But the site overlaps with land earmarked for the Teesworks data centre, backed by Tees Valley mayor Lord Houchen.
Planning documents have warned that the two projects cannot co-exist.
A letter from Business Secretary Peter Kyle to Lord Houchen, confirmed the decision, describing the Teesworks project as the cornerstone of the UK’s AI strategy. Ministers will now push leading AI firms to invest in the development.
Mr Miliband had delayed a final decision on the hydrogen plant until late October, leaving both projects in limbo. BP has said it remains committed to the project, though it has yet to secure a main customer.
The row highlights tensions between Labour’s net zero goals and Sir Keir’s drive to make Britain a global leader in AI, ahead of a planned technology partnership with US President Donald Trump next week.
