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Microsoft exits UK Nscale AI data centre deal over power delays stretching into the 2030s
Microsoft confirmed on October 19 that it has terminated its agreement as the anchor customer of Nscale's AI data centre in Loughton, Essex, after grid officials said power would not arrive until the 2030s. The 50MW facility with 23,040 Nvidia GB300 GPUs was billed as Britain's largest sovereign AI data centre.
Why it matters
Microsoft confirmed on October 19 that it has terminated its agreement to serve as the principal customer of a flagship AI data centre being developed by Nvidia-backed Nscale in Loughton, Essex. According to Reuters, electricity grid officials had told Nscale that sufficient power would not be available until the 2030s, several years beyond the site's original timetable, which called for operations to begin early next year.
Scale of the project
The Loughton facility was planned at 50 megawatts of initial computing capacity, expandable to 90MW, with 23,040 Nvidia GB300 GPUs intended to support Microsoft's Azure services in Britain. The project was among the technology deals announced during US President Donald Trump's visit in September 2025 and was presented as Britain's largest sovereign AI data centre.
What both sides say
A Microsoft spokesperson said: "This decision relates to a single site." The company remains committed to its partnership with Nscale, including work in Norway, Portugal and the United States. Nscale said its relationship with Microsoft "remains strong and long-term" and that it stays committed to the Loughton project and the UK, exploring alternative power sources. Nscale, backed by Nvidia, filed for a US initial public offering last month, with Microsoft and Anthropic expected to be among its major customers, according to its prospectus.
Context
Britain's energy regulator and electricity system operator have warned that grid connection queues can delay data centre projects by as long as 13 years, with investment agreements advancing faster than the networks required to supply them. The Loughton withdrawal is the latest example of electricity supply becoming the binding constraint on the global AI buildout.
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