Google in Advanced Talks for Landmark Teesside Datacentre Deal Amid Political Tensions

Google is negotiating the construction of a vast datacentre on the former SSI steelworks site in Teesside, a move that could herald a major economic transformation for the North East of England. The American technology conglomerate is understood to be engaged in sensitive talks with Teesworks—the 4500 acre regeneration project championed by Tees Valley mayor Lord Ben Houchen.

This initiative is poised at a critical juncture as government departments weigh competing visions for the site. Datacentres, while generating a modest number of direct jobs, can support thousands during construction and are forecast to boost the UK economy by an estimated £44 billion by 2035. The potential investment arrives on the back of Teesworks being designated an AI Growth Zone by Sir Keir Starmer’s new business team, positioning the site as a prime destination for digital infrastructure.

Political intrigue threatens to derail the project, with Energy Secretary Ed Miliband throwing his support behind BP’s plan to develop H2Teesside, a major hydrogen production facility targeting 1.2GW—over 10 percent of the government’s 2030 goal. Infrastructure constraints mean that large-scale datacentre construction and hydrogen production on the same site are regarded as mutually exclusive. Recent legal documents from BP have described Google’s proposition as speculative and lacking thorough consideration, highlighting tensions between the corporate giants and local authorities.

Business sources in Tees Valley suggest Google’s apparent surge into contention for the Teesworks site has blindsided the local business community and shifted political backing. BP’s hydrogen ambitions, once promoted by Houchen as the region’s flagship project, now find themselves in an uncertain position, with formal objections raised by law firms representing the region’s stakeholders.

Should Starmer’s cabinet win the internal contest over Miliband’s preferences, the site could see rapid progress towards datacentre development, though a judicial review from BP remains within the realm of possibility. The scale and promise of Google’s proposal mark a striking shift in fortunes for Teesside, once hard-hit by the steelworks collapse in 2015, which resulted in over 2000 job losses and left a bitter legacy denounced as industrial vandalism by trade unions at the time.

Approval of Google’s datacentre would signal not only the recovery of a region scarred by deindustrialisation, but a commitment to the future of digital infrastructure and economic revitalisation in the North.