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    AI Data Centre Plan Could Change The Case For Drax Group Shares

    Simply Wall St·11/03/2026 23:52:02
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    • Drax Group has partnered with Brookfield and AI infrastructure platform Radiant to plan over 1 gigawatt of data centre capacity at Drax Power Station. A first 100MW phase is targeted for early 2028 and potential investment could exceed £20 billion, subject to planning and regulatory approvals.
    • The project repurposes existing land, power and grid access at Drax Power Station, signalling a shift toward higher value digital infrastructure alongside its contracted renewables and flexibility assets.
    • The focus now turns to how Drax Group’s investment narrative could change as it pursues large scale AI data centre capacity.

    Scan how Drax Group fits into the wider build out of AI infrastructure by reviewing a hand picked set of 53 AI infrastructure stocks that are gaining attention from capital allocators right now.

    Drax Group Investment Narrative Recap

    Drax Group appeals to investors who buy into a simple idea. The future of the business leans on contracted low carbon generation, a growing FlexGen and BESS footprint, and now the potential to supply power and grid access to large scale data centres. The short term hinge point remains clean execution on U.K. build outs and integration of new assets into stable, cash generative operations.

    The biggest near term risk is that capital heavy projects such as batteries, OCGTs and the data centre tie up large sums without delivering the quality of earnings investors expect, especially with profit margins currently thin and debt already high. The latest data centre plans change the mix of opportunities but do not remove that execution risk.

    The completed acquisition of Bluefield Solar Income Fund is the announcement that matters most alongside the AI data centre plan. It adds around 0.9GW of operating solar and wind plus a sizeable development pipeline, which can support the shift toward contracted renewables revenue as the Drax Power Station CfD sets a clearer framework for biomass output.

    Together, Bluefield and the data centre concept concentrate the story on whether Drax Group can knit biomass, solar, wind, FlexGen and storage into a coherent, capital disciplined platform. For you, the key questions are straightforward: Can management deliver these projects on time and budget, and can the combined portfolio improve margins without stretching the balance sheet further?

    Drax Group Consensus Assumptions In Focus

    Drax Group's narrative projects £3.9b revenue and £260.1m earnings by 2029. This aligns with analyst assumptions of a 9.3% yearly revenue decline and an earnings increase of about £241m from £19.0m today.

    Uncover why Drax Group's fair value indicates a 7% potential upside to its current price that could narrow quickly.

    LSE:DRX 1-Year Stock Price Chart
    LSE:DRX 1-Year Stock Price Chart

    Exploring Other Perspectives

    One alternate angle on Drax Group focuses on the bullish catalyst around earnings power. Some of the highest analysts were already modelling about £5.5b of revenue and roughly £341.1m of earnings by 2029 before this AI data centre news. That is a far more optimistic path than consensus, so you may want to compare several viewpoints and decide which assumptions feel realistic.

    Explore 2 other Drax Group fair value estimates, including one that suggests up to 18% upside from the current price.

    Reach Your Own Conclusion

    Don't just follow the ticker. Dig into the data and build a conviction that's truly your own.

    Looking For More Investment Ideas Beyond Drax Group?

    If you want to balance your view on Drax Group with fresh ideas, the Simply Wall St Screener can help you quickly filter for other companies that match the kind of risk and return profile you care about most.