---
title: "Microsoft pulls out of Nscale’s planned AI data centre in Loughton, Essex, as power delays bite"
url: https://anawords.com/story/microsoft-exits-nscale-loughton-essex-ai-data-centre
published: 2026-10-20T12:37:16+05:30
updated: 2026-10-20T12:37:16+05:30
section: Chips & Compute
author: Mayank Sahu
checked: sources checked by AI, approved by editor
version: 1
---

# 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.

**In short:** Microsoft has withdrawn from its agreement to use Nscale’s planned AI data centre in Loughton, Essex, The Telegraph first reported on 18 October 2026.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.

## 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.[^1][^2] Microsoft declined to comment and has not given a reason.[^1][^2]

The site was meant to be Nscale’s first British data centre and to support Microsoft’s Azure services.[^1][^2] 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.[^1][^2] Neither report says this was Microsoft’s reason.[^1][^2]

## 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.[^1][^2] It plans to go ahead with Loughton and is looking at other power sources and UK sites.[^1][^2] 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

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

## Sources

1. [TNW: Microsoft reportedly quits Nscale’s UK data centre weeks before its IPO](https://thenextweb.com/news/microsoft-pulls-out-nscale-loughton-data-centre-ipo)
2. [CloudComputing News: Microsoft exits UK AI data centre deal amid reported power grid delays](https://www.cloudcomputing-news.net/news/microsoft-nscale-uk-ai-data-centre/)