Microsoft has pulled out of the AI data center Nscale is planning at Loughton in Essex, the site that was meant to carry Azure capacity for the UK from early 2027. The Telegraph reported the withdrawal on 18 October and Reuters followed on 19 October. The reason given in both reports is electricity: grid officials have told Nscale they do not expect to supply the site before the 2030s.
A 50 MW Building Waiting For Its Connection
Loughton was announced in September 2025, during the US state visit, and it was part of the £22 billion UK investment that Microsoft presented at the time. According to The Register, the plan was 23,040 Nvidia GB300 GPUs in a 50 MW facility with room to grow to 90 MW, and Nscale marketed it as the largest sovereign AI data center in Britain. In March the plot was still in use as a scaffolding yard. Nscale has cleared it since.
The warning was not new. The Register refers to a Guardian report from September that UK Power Networks had told Nscale the capacity might not be available until the 2030s. The distribution operator says it cannot comment on individual connections, but points out that many data centers are waiting on reinforcement of the national transmission network, which it does not own.
Microsoft's line is that the decision concerns one site and that the partnership with Nscale continues. Nscale says it is still committed to Loughton and is looking at alternative power sources for it, as well as at other sites in the UK. It has not said which sources. The company called the problem a London-wide grid issue and said its other contracts are not affected. The timing hurts: Nscale filed for a US listing in September, and its prospectus names Microsoft and Anthropic among its main customers.
Britain's Connection Queue In Numbers
Reuters notes that connection queues can hold data center projects back by up to 13 years. The Register gives the British picture: requests for connections rose from 41 GW to 125 GW in under a year, at least 80 GW of that from data centers, and Ofgem has proposed charging developers for connection requests to thin out the speculative ones. Some UK developers are already planning gas-fired generation instead of waiting.
"Alternative power sources" is the phrase to follow here. For a 50 MW hall on the edge of London the candidates are on-site gas engines, turbines or fuel cells, either for good or as a bridge until the cable comes, perhaps with a smaller first phase. None of them is a drop-in change. A site laid out for a grid feed with standby generators has room for fuel tanks and a generator yard; a site that makes its own prime power also needs a gas supply, exhaust stacks, heat rejection for continuous running and an air permit, and in a built-up area noise becomes a planning issue of its own. Whether the Loughton plot can take all that is now Nscale's question to answer. More on how generating plant serves data centers.
For the moment the site has a 2027 chip date without an anchor tenant and a 2030s power date without a published plan B.
Sources: Reuters (Yahoo Finance), The Register
