Tuesday, 20 October 2026
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Chips & ComputeDeveloping story

Microsoft pulls out of Nscale’s planned AI data centre in Loughton, Essex, as power delays bite

Nscale says its relationship with Microsoft remains strong and it will still build the site. The local grid operator has said full power may not arrive until the 2030s.

Anawords illustration (not a photo): Microsoft and Nscale. Microsoft exits Loughton data centre deal. Reported by two or more outlets.Illustration · not a photo
Built by Anawords from the facts in this story. Not an official company image. Graphic: Anawords

How this story was checked

  1. ResearchedWith AI assistance · 2 sources
  2. AI source checkEach sentence matched to its source
  3. Editor approvalMayank Sahu · 20 Oct, 12:37
  4. Published20 Oct, 12:37
Read the research behind this story3 sources read · 2 used · what we could not verify · published 20 Oct, 12:27 →

Verify this story

4 reported2 unconfirmed1 not known

How this was made: researched, drafted and source-checked by AI (Claude, made by Anthropic), then published under the editor’s standing approval. A person did not read it line by line before it went live. AI policy

In short

Microsoft has withdrawn from its agreement to use Nscale’s planned AI data centre in Loughton, Essex, The Telegraph first reported on 18 October 2026. Nscale says it remains committed to the site and its other Microsoft contracts are unaffected; the site has been told it may not get enough power until the 2030s.

Microsoft withdrew from Nscale’s planned AI data centre in Loughton, Essex, first reported by The Telegraph.1,2
Nscale says its relationship with Microsoft remains strong and other contracts are unaffected.1,2

What happened

Microsoft has pulled out of its deal to be the anchor customer at Nscale’s planned AI data centre in Loughton, Essex, The Telegraph reported, and other outlets followed.12 Microsoft declined to comment and has not given a reason.12

The site was meant to be Nscale’s first British data centre and to support Microsoft’s Azure services.12 CloudComputing News, citing the Financial Times, says Microsoft had agreed to lease the first 50MW of a site expandable to 90MW.2

The power problem

The site has faced delays. Nscale was told not to expect enough electricity until the 2030s; CloudComputing News, citing The Guardian, says UK Power Networks put it at the early to mid-2030s.12 Neither report says this was Microsoft’s reason.12

What Nscale says

Nscale said its “relationship with Microsoft remains strong and long-term” and that the grid issue does not affect its other contracts, which cover sites in the US, Portugal and Norway.12 It plans to go ahead with Loughton and is looking at other power sources and UK sites.12 It has not named a new customer.2

Context

Nscale is preparing a US listing; TNW reports it is seeking up to $3 billion.1 Its filing lists about $103.4 billion of active and contracted deals as of 31 August.2 Separately, UK regulator Ofgem is reviewing how data centres join the grid, after connection requests rose sharply; it has not linked that work to this deal.2

Why it matters

The UK wants more domestic AI compute, but grid connections are now one of the main limits. Projects with power in place are likely to move faster than those waiting for it.

Fact ledger

How labels work
Reported · 4
Microsoft withdrew from Nscale’s planned AI data centre in Loughton, Essex, first reported by The Telegraph.Source 1,2
Microsoft declined to comment and gave no reason.Source 1,2
Nscale says its relationship with Microsoft remains strong and other contracts are unaffected.Source 1,2
The site was told enough power may not arrive until the 2030s.Source 1,2
Unconfirmed · 2
Microsoft had agreed to lease the first 50MW of a site expandable to 90MW.Source 2
Nscale seeks up to $3 billion in its IPO.Source 1
Not known · 1
Microsoft’s reason for withdrawing.Not announced

Questions readers ask

Why did Microsoft leave the Nscale Loughton project?

Microsoft has not said. The site has faced power delays, but neither report links them to Microsoft’s decision.

Will Nscale still build the Loughton data centre?

Nscale says it plans to go ahead and is looking at other power sources and UK sites.

Are Nscale’s other Microsoft deals affected?

Nscale says no. Its contracts for sites in the US, Portugal and Norway are unaffected.

Sources

  1. 1TNW: Microsoft reportedly quits Nscale’s UK data centre weeks before its IPO
    Checked 20 Oct 2026 · Archived copy (20 Oct 2026)
    OUTLET
  2. 2CloudComputing News: Microsoft exits UK AI data centre deal amid reported power grid delays
    Checked 20 Oct 2026
    OUTLET

Updates and corrections

v120 Oct 2026, 12:37First published. Research note published first. Sources checked by AI; approved for publication by the editor.

Written and approved by

Mayank Sahu, Founder & Editor

Mayank Sahu is an SEO expert who loves using AI and learning how it works. He started Anawords because he felt the market was missing the best AI articles: clear, sourced and honest about what is confirmed and what is only claimed. He sets the rules every Anawords story must pass, runs its AI-assisted research desk and gives the approval its stories are published under. Each story says how it was checked.

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