Microsoft withdrew as anchor tenant for an Essex AI data center after grid delays moved expected power availability years beyond the planned opening.
Microsoft has pulled out of an agreement to anchor a planned AI data center in Loughton, Essex, being developed by Nvidia-backed infrastructure company Nscale. Reuters reported on October 19 that the expected grid connection had slipped into the 2030s, far later than the site’s planned start of operations early next year. Microsoft characterized the decision as specific to that location and said it remains committed to its broader partnership with Nscale.
The planned facility was expected to provide 50 megawatts of computing capacity using 23,040 Nvidia GB300 GPUs, supporting Microsoft Azure services in the UK. Nscale said the power delay does not affect its other contracts and that it is exploring alternative power sources for Loughton as well as other UK expansion sites. The development illustrates how grid access, not just financing or chip supply, can determine whether a large AI-computing project becomes operational on schedule.
The setback also raises questions for the UK’s ambition to attract data-center investment and expand domestic AI capacity. Reuters reported that grid-connection queues have delayed projects by as much as 13 years in some cases. Nscale has grown quickly and filed for a US initial public offering, with Microsoft and Anthropic identified as major expected customers in its prospectus. The withdrawal therefore puts attention on execution risk around infrastructure commitments, although both companies said their wider relationship remains intact. It does not mean the Loughton project is cancelled: Nscale says it remains committed to the site while seeking another way to secure power. The project’s next milestones will show whether alternative supply can make the planned capacity viable sooner.