Microsoft pulls out of Nscale's Essex AI data centre as grid power slips to the 2030s

Microsoft has terminated its agreement for the planned Nscale AI data centre in Loughton, Essex, after electricity grid officials told Nscale they did not expect to supply power to the site until the 2030s, Reuters reported on 19 October. The move was first reported by The Telegraph.

What was planned

• The project was among the technology deals announced during US President Donald Trump’s state visit to Britain in September 2025.
• According to the companies’ earlier statements cited by Reuters, the site was to run 23,040 Nvidia GB300 GPUs providing 50 megawatts of AI computing capacity for Microsoft’s Azure services in the UK, and was due to begin operating early next year.
• The BBC says Nscale had pledged £2bn for the facility, which is expected to create 250 permanent jobs when it eventually opens.

What the companies say

“This decision relates to a single site,” a Microsoft spokesperson told Reuters, adding that the company remains committed to its partnership with Nscale. Nscale said the “London-wide grid issue” had no impact on its other contracts and that it is exploring alternative power sources for Loughton and other UK expansion sites. The two companies continue to work together in Norway, Portugal and the United States, according to the BBC.

Why it matters

Reuters notes that bottlenecks in grid connection queues are delaying some UK data-centre projects by as long as 13 years, a major constraint on Britain’s AI ambitions. The Telegraph reported that Microsoft was the site’s only announced customer and that the decision could complicate Nscale’s plans for a US stock market listing.