# Microsoft cancels UK data center deal amid power delays

> Live situation record from CLSTR: https://clstr.news/situations/uk-ai-supercomputer-project-power-grid-delays
> Updated: 2026-10-18T08:53:28.000Z. Sources: 42. Developments: 3.

The development of the United Kingdom’s largest planned AI supercomputer in Loughton, Essex, faces significant delays due to electricity supply constraints. Managed by the startup Nscale and backed by Nvidia, the project was originally intended to come online in 2027 to support Microsoft Azure cloud services using approximately 23,000 Nvidia AI chips.

UK Power Networks has informed Nscale that the local grid cannot provide the required connection—potentially growing from 50 to 90 megawatts—until the early to mid-2030s due to severe congestion and the need for extensive work on the national transmission network. To mitigate these bottlenecks, Nscale is investigating on-site power generation options, such as solid-oxide fuel cells. Meanwhile, National Grid is reportedly working with the national system operator, NESO, to attempt to accelerate grid connections.

In October 2026, Microsoft terminated its agreement to anchor the planned £2 billion data center, citing the electrical grid constraints. This withdrawal is a significant blow to Nscale, which is preparing for an initial public offering (IPO) on the New York Stock Exchange with a target valuation of $35 billion. According to IPO filings, Microsoft and Anthropic together account for approximately 85% of Nscale’s total compute contracts. While Microsoft accounted for approximately $43.8 billion of Nscale’s $103.4 billion contracted backlog, Nscale stated its relationship with Microsoft remains “strong and long-term” and that the company remains committed to the Loughton project. Nscale is also managing existing delays at its facility in Glomfjord, Norway, where only 6.4 MW of a planned 30 MW is currently live.

## Claims

- Microsoft has terminated its agreement for a data center facility in Loughton, Essex. (corroborated by 32 sources)
- UK Power Networks will not be able to supply sufficient power to the Loughton site until the early to mid-2030s. (corroborated by 28 sources)
- Nscale maintains that its relationship with Microsoft remains strong and long-term. (corroborated by 18 sources)
- Nscale is targeting a $35 billion valuation in its upcoming NYSE listing. (corroborated by 16 sources)
- Nscale is exploring alternative power sources for the Loughton site. (corroborated by 8 sources)
- Nscale aims to raise up to $3 billion through its initial public offering. (corroborated by 8 sources)
- Nscale’s flagship facility in Glomfjord, Norway, is currently operating 6.4 MW of a planned 30 MW. (corroborated by 6 sources)
- Microsoft and Anthropic together account for approximately 85% of Nscale’s compute contracts. (corroborated by 6 sources)
- Anthropic agreed to spend $45 billion on Nscale compute over six years. (corroborated by 4 sources)
- Nscale plans to install approximately 23,000 Nvidia AI chips at the Loughton data centre. (corroborated by 3 sources)
- The computing power from the supercomputer is intended to support Microsoft Azure cloud services. (corroborated by 3 sources)

## Timeline

### 2026-10-18: Microsoft exits Nscale UK AI data center deal over power grid delays

Microsoft has exited its agreement for Nscale’s planned AI data center in Essex, UK, due to power grid delays that could stall electricity supply until the 2030s, impacting Nscale’s upcoming $35bn IPO plans.

36 sources. https://clstr.news/cluster/microsoft-cancels-uk-data-center-deal-with-nscale-due-to-power-grid-delays

### 2026-09-29: UK AI supercomputer faces delays due to power grid constraints

The UK's largest planned AI supercomputer, developed by Nscale in Loughton, may be delayed until the 2030s due to insufficient electricity supply from the local power grid.

6 sources. https://clstr.news/cluster/uk-ai-supercomputer-faces-delays-due-to-power-grid-constraints

### 2026-09-24: UK AI supercomputer project delayed by power grid constraints

The UK’s largest planned AI supercomputer in Loughton faces delays until the mid-2030s due to power grid congestion and insufficient electricity supply.

2 sources. https://clstr.news/cluster/uk-ai-supercomputer-project-delayed-by-power-grid-constraints

---
Cite as: Microsoft cancels UK data center deal amid power delays. CLSTR, https://clstr.news/situations/uk-ai-supercomputer-project-power-grid-delays