North East set to become AI powerhouse

This will build on the region's work to upskill local residents in AI and create opportunities for people to take up long term careers in the sector - including the technology's development and use of AI in public services like healthcare.

Announced today (17 September), it will solidify the region's ambition to become one of the largest data centre hubs anywhere in Europe - made up of sites in Blyth and Cobalt Park near Newcastle - helping to boost economic growth and create new high skilled jobs, putting more money in people's pockets.

By boosting the rollout of AI in the area, this new AI Growth Zone will:

• Create thousands of jobs across the region, including in construction through to data engineering, AI research and development, and AI safety.
• Put newly trained AI experts from local universities including Newcastle University, Durham University, Sunderland University and Northumbria University, within touching distance of the UK's newest emerging tech hub.
• Drive local economic growth and increase productivity of businesses in sectors including manufacturing, healthcare, energy and finance by enabling them to more easily adopt AI and compete globally.
• See new breakthroughs in our understanding of drug discovery, climate change and safer technology by giving researchers, scientists, start ups and academics access to AI power.

AI Growth Zone

The AI Growth Zone will generate growth opportunities across the region, capitalising on access to the UK's largest source of low carbon and renewable energy, world class universities and the regions emerging tech ecosystem in areas including advanced manufacturing, robotics and space.

Blackstone has already committed £10 billion into the Blyth site - with the new designation of an AI Growth Zone providing the potential for an additional £20 billion in investment from future partners.

Separate from the Blackstone investment, British firm Nscale, and leading American companies OpenAI and NVIDIA partner up to establish Stargate UK to deliver new AI infrastructure in the UK, developing a platform designed to deploy OpenAI's technology on sovereign infrastructure in the UK.

The first phase will see OpenAI take up to 8,000 GPUs - computer chips which are the building blocks of AI technology, able to carry out a huge number of calculations in a split second - to support AI adoption across the UK early next year, with the possibility to expand to approximately 31,000 GPUs overtime.

Stargate UK is expected be based across a number of sites in the UK, including in Cobalt Park, which will form part of the newly designated AI Growth Zone in the North East.

The partnership between these firms will help boost AI infrastructure and adoption in the UK - transforming public services and growing the economy to support the government's Plan for Change. It comes as Prime Minister and President Trump ink a new deal to unlock investment and collaboration in AI, Quantum, and Nuclear technologies - driving economic growth and boosting jobs.

Technology Secretary Liz Kendall said: "This is great news for the North East and the people who live there. This investment will create thousands of high-quality jobs, boost skills and inspire the creation of new firms.

"The North East's industrial legacy is evolving into a future of innovation - unlocking a potential £30 billion and powering communities with the skills and careers to lead the UK's next industrial revolution."

North East Mayor Kim McGuinness said: "Today's announcement of an AI Growth Zone places the North East at the forefront of the next technology revolution and will lead to billions of pounds of new investment in our region, thousands of better jobs and new opportunities for local people.

"I want kids in school here today to see their place in an AI-driven future. We know AI will be transformative for our economy, but this is how we make sure it also provides a new future for our young people, by working with business to create training and apprenticeship routes into this fast growing sector on a whole new scale.

"Our region boasts computing power that are among the best in Europe with Cobalt Park Data Centres already established in Wallsend and the QTS Cambois Data Centre Campus in Blyth due to open in 2028. We have the skills and brainpower in our tech sector and universities, and now we can match that with the new investment this Growth Zone will bring to the North East from around the world."

Universities - driving research in AI

Universities across the region are already driving research in AI, from better patient care to new ways to speed up mortgage approvals and detect fraud. TheNational Innovation Centre for Data based at Newcastle University is also developing an AI curriculum to upskill local residents on the use of AI through to training data scientists - making the region a prime location to capitalise on local infrastructure and a pipeline of talent.

Professor Chris Day, Vice-Chancellor and President, Newcastle University said: "We are excited to play a key role in the AI Growth Zone and to continue driving economic prosperity in the North East.

"This investment will enable us to expand training in AI, data science, cloud infrastructure and data-centre engineering. It will be vital in upskilling the local workforce that will benefit from new jobs in this key growth sector.

"It will also enable us to provide cutting-edge AI and data research to support companies locating in the zone, building on our world-leading expertise.

"This announcement cements Newcastle University's role in developing an exciting innovation ecosystem in the North East that will benefit the region and the country more widely."

"home to world-class researchers"

Founder and CEO of NVIDIA Jensen Huang said: "Today marks a historic chapter in U.S.-United Kingdom technology collaboration. We are at the Big Bang of the AI era - and the United Kingdom stands in a Goldilocks position, where world-class talent, research and industry converge.

"By building state-of-the-art AI infrastructure and investing in British startups, we are unlocking the power of AI for the U.K. - fuelling breakthroughs, creating jobs, and igniting the next industrial revolution."

Nscale CEO Josh Payne said: "We're delighted to announce Nscale's commitment to UK AI infrastructure today, including through Stargate UK and building the most powerful supercomputer in the country with Microsoft.

"As a UK-based company, we're showing how we can be makers, not takers, of the most important technology of our time."

At Cobalt Park, within the AI Growth Zone,thousands of cutting-edge computer chips are expected to be rolled out by NScale, with Open AI poised to be the first company to then harness their abilities.

The AI Growth Zone as a whole, with a new data centre in Blyth, will increase its energy capacity to 1.1GW in the next 6 years - making it one of the biggest data centres in Europe and creating thousands of new jobs.

Sam Altman, CEO of OpenAI said: "The UK has been a longstanding pioneer of AI, and is now home to world-class researchers, millions of ChatGPT users, and a government that quickly recognized the potential of this technology. Stargate UK builds on this foundation to help accelerate scientific breakthroughs, improve productivity, and drive economic growth. This partnership reflects our shared vision that with the right infrastructure in place, AI can expand opportunity for people and businesses across the UK."

This is a key part of the government's vision for AI Growth Zones is using more clean energy which is abundant in the North East with its existing wind farm infrastructure, plans to develop solar energy sources and greater battery storage capacity.

The £30 billion potential investment includes £10bn already committed by Blackstone - with work underway to develop the site which will establish the region as a hub for AI development and a key driver of the government's Plan for Change.

If you're interested in this growth area, find out more about courses involving AI and data or more about how we work with industry at Newcastle University.

(Adapted with thanks to DSIT)