Business · Companies · 1 hr ago
Microsoft withdraws from Nscale’s Essex AI data centre project
Microsoft has withdrawn from Nscale’s planned AI data centre in Loughton, Essex, after concerns about the site’s power supply.
The project was announced in 2025 and described by the UK government as the country’s largest sovereign AI data centre.
Microsoft was expected to be the project’s anchor customer, and its withdrawal leaves Nscale without a publicly announced customer for the site.
Power supply problems had already been reported, with the project facing a lengthy wait before it could come online.
The setback challenges Nscale’s plan to build UK-based data centre capacity and could affect its ambition to list on Wall Street this year.
Nscale says it remains committed to the project and is exploring alternative power sources and other UK sites.
Microsoft has withdrawn from an agreement to be a customer at Nscale’s planned AI data centre in Loughton, Essex, citing concerns over power supply.
The project was announced in 2025 as the UK’s largest AI data centre and was planned to open next year.
The withdrawal leaves Nscale without a publicly announced customer for the Essex site.
Nscale said it remains committed to the project and is exploring alternative power sources.
Microsoft remains involved in a separate Nscale project in Norway, according to the Guardian.
- Who
- Microsoft and British data centre company Nscale.
- What
- Microsoft withdrew from its agreement to be a customer at Nscale’s planned Loughton data centre.
- When
- The withdrawal was reported on 18 October 2026.
- Where
- The planned data centre is in Loughton, Essex, UK.
- Why
- Power supply concerns and grid problems have delayed the project.
Microsoft
Nscale
Project viability
Microsoft
Microsoft withdrew from its agreement over concerns about power supplies.
Nscale
Nscale said it remains committed to the Loughton project and is exploring alternative power sources.
Nscale’s Loughton project was announced as the UK’s largest AI data centre.
The Guardian reported that the site was still an operational scaffolding yard.
Power supply problems were reported to mean the project would face a lengthy wait before coming online.
Microsoft’s withdrawal from its agreement with Nscale was reported.
- Planned site
- Loughton, Essex
- Announced
- 2025
- Planned opening
- 2027
- Microsoft’s role
- Expected anchor tenant
- Publicly announced customers after withdrawal
- None
3 sources
What people are saying
We remain committed to both the Loughton project and the UK, and we are exploring alternative power sources for the site, in addition to other expansion sites in the UK.
Our relationship with Microsoft remains strong and long-term, and this unfortunate London-wide grid issue has no impact on our other contracts.