The funding, unveiled by the UK government, is intended to reduce reliance on gas by reusing excess heat that would otherwise be vented into the atmosphere. DESNZ claims the Thames project alone will supply 650,000 London homes with ‘clean heat’, with barges expected to begin operating in 2028 and a tunnel link following in the 2030s. A departmental spokesperson confirmed the £41 million covers only the barge phase; the cost of the tunnel section has not yet been disclosed.
Similar district heating schemes have long operated in European cities such as Copenhagen, Amsterdam, Vienna and Berlin, but the UK has been slower to adopt them. A 2023 project in west London proposed connecting 10,000 new homes to nearby server farms.
Despite the headline figures, doubts remain about the efficiency of using datacenter waste heat for domestic heating. The Uptime Institute has previously noted that the temperature of such waste heat is often too low for home use, requiring heat pumps that consume additional energy. A 2024 report by trade association TechUK warned that most existing UK heat networks are third-generation designs, which have lower efficiency and higher carbon intensity than newer fifth-generation systems capable of handling lower-temperature inputs.
Public opinion appears broadly supportive. A poll by energy-efficiency adviser EnergiRaven found that 60% of Britons believe planning permission for datacenters should depend on them supplying waste heat to local homes, and 62% would be more supportive of a local datacenter project if it included heat sharing. EnergiRaven is calling for all new server farms above 1 MW to include heat-recovery infrastructure.
Alan Howard, an analyst at Omdia, noted that district heating can benefit communities and help datacenter operators build local goodwill, but said the government’s announcement does not clarify whether the focus is on existing or new facilities. “It’s too early to call it a project; rather at this stage it is a concept. However, the government commitment is impressive and important to make such sweeping changes,” he said.
Questions about timeliness and cost remain. The recently completed Thames ‘super sewer’ tunnel took nine years and cost around £5 billion, raising concerns about whether the heat tunnel will be dug and at what final price.