Energy giant Drax has announced plans to build an AI data centre on 4.5 hectares of land at its North Yorkshire site.
The land to be built on is about the size of six football pitches.
Drax, which owns and operates the site in Selby, said the data centre will "protect hundreds of jobs".
The site had been a coal-burning power station but was turned into a government-subsidised renewable energy plant burning woody biomass pellets.
The data centre project is part of a deal, valued at up to £20bn, between Drax, Canadian multinational Brookfield, AI infrastructure developer Radiant, and a subsidiary of the Qatar Investment Authority.
They aim to have the first phase of the project, which will run on energy from the national grid, operational in the first three months of 2028.
Data centre controversy
Data centres have proved controversial projects in recent years, at times attracting local opposition for their size, noise, and water and energy consumption when parts of the country are in drought and the national grid has struggled.
In recognition of this, Chancellor John Healey announced a "data centre covenant" in the budget, which requires data centres to invest in local communities.
What next?
Planning permission and regulatory approval are both needed, as is a tenant company to use the data centre, the Drax announcement said.
Each party has yet to take a final investment decision, it added.
Community consultation will begin "shortly", a Drax spokesperson said, before a planning application is submitted "in the coming months".
Even if local planning permission is denied, the government can grant approval for the project as data centres have been designated critical national infrastructure, along with things like postal services and telecommunications.
Sky News reporting in 2021 found the Selby plant was the biggest single source of carbon dioxide in the UK.
Drax's wood pellet burning programme had been investigated by the Financial Conduct Authority for nearly 10 months, but the company was cleared of misleading shareholders with its sustainability claims.
(c) Sky News 2026: Plans announced for AI data centre at Drax site in North Yorkshire
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