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Britain now has the highest industrial electricity prices in the developed world. At 25p per kilowatt-hour, its power costs stand at double the EU average and quadruple those of the US (6p) and China (7p).
But this isn’t just about the death of old industry. Just as cheap electricity determined the industrial powers of the past, it will now determine the AI superpowers of the future.
The real competition is not about who builds the best AI models, but who can afford to run them. Sovereignty in this century is found in the physical ability to process Intelligence at an industrial scale.
Britain’s current path is a dead end. There are 140 data centers in the UK’s grid connection queue, representing 50 GW of demand — more than the entire country’s current peak usage (45 GW). For many, the quoted connection date is 2040.
As Intelligence proliferates, productivity will no longer be measured in man-hours, but in Tokens-per-Watt: how many units of ‘Intelligence’ a kilowatt-hour of electricity can buy. With its 25p rate, it is already 400% more expensive to buy Intelligence in Britain than in China or the US.
This is a direct hit to the UK services sector, which accounts for 82% of the economy. As AI automates knowledge work, British firms must 'rent' intelligence from foreign clouds at predatory rates just to stay competitive.
Even if Britain builds domestic AI infrastructure, the 25p barrier means it would be structurally uncompetitive from day one. This leaves only the path of outsourcing national productivity to foreign clouds, a permanent transfer of British wealth.
True sovereignty requires a radical shift to dedicated, low-cost power for compute. Without cheap energy, Britain won’t just lose its factories — it may lose its offices, too.
Andrew Bennett@andrewjb_
UK sectors most exposed to AI are also our biggest tax contributors:
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