Microsoft has exited a UK AI data center project after electricity supply delays.
Microsoft has reportedly withdrawn from an agreement to become the anchor customer for a planned artificial intelligence data center in Loughton, England. Delays in securing an electricity connection pushed the facility's expected availability into the 2030s. The news was first reported by The Telegraph, a London newspaper.
The project was announced in 2025 during President Donald Trump's visit to England. It was intended to provide 50 megawatts (MW) of AI computing, with the potential to scale to 90 MW using 23,040 Nvidia GB300 processors. The facility was originally expected to begin operating in early 2027. However, grid connection delays have pushed the expected power availability back by several years, making the original deployment schedule unworkable for Microsoft.
Microsoft was the main tenant. Nscale, a British AI infrastructure company that builds and operates data centers offering cloud services for AI, was the data center owner and builder. Electricity grid officials told Nscale they did not expect to supply power to the Loughton, Essex, site until the 2030s.
"We remain committed to our partnership with Nscale, including work to build robust digital infrastructure and support AI growth globally. This decision relates to a single site," a Microsoft spokesperson said in a statement to Network World. In its termination of the agreement for the Loughton data center, Microsoft said the decision "relates to a single site."
An Nscale spokesperson told Reuters: "Our relationship with Microsoft remains strong and long-term, and this unfortunate London-wide grid issue has no impact on our other contracts." The company added: "We remain committed to both the Loughton project and the UK, and we are exploring alternative power sources for the site, as well as other expansion sites in the UK."
Nscale is a young company that has grown very quickly. Its total contracted value has risen from $100 million to more than $103 billion in two and a half years. However, it depends heavily on two customers: Microsoft and Anthropic, which together account for approximately 85% of its contracts.
The timing is difficult for Nscale, which filed for a U.S. initial public offering just last month. Losing Microsoft's commitment at Loughton could complicate investors' assessments of the company's ability to deliver planned infrastructure on schedule.
The Loughton power issue shows that access to electricity is not just a U.S. problem but a global one, and that power can be as important as access to advanced processors, capital and data center construction capacity.