Microsoft Exits Nscale's 50MW Loughton Data Center Deal In Essex

Microsoft has ended its agreement to anchor Nscale's Loughton AI campus in Essex, the 50MW facility that UK ministers promoted as the country's largest sovereign AI data center when it was announced in 2025. The withdrawal, first reported by The Telegraph on Oct. 18, leaves the £2bn project without its only publicly announced custoExterior photograph of a Microsoft corporate facility from BBC coverage.mer. Microsoft declined to comment, and Nscale says it will build the site anyway.

The Loughton campus was to deliver 50MW of AI capacity, scalable to 90MW, and house 23,040 Nvidia GB300 GPUs from the first quarter of 2027 to serve Azure customers in the UK. Microsoft had been one of Nscale's two largest customers and was the expected anchor tenant.

The binding problem is power. UK Power Networks, which runs the grid across London and the South East, told Nscale it could not supply enough electricity to Loughton until the early to mid 2030s, as the Guardian reported. The project had already slipped from an earlier target, and in March 2026 the site was still operating as a scaffolding yard.

"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," a spokesperson for Nscale said. The company said its relationship with Microsoft remains strong on projects in Norway, Portugal and the United States, where the two are building a 240MW campus in Texas.

The loss lands at a bad moment. The London-based neocloud, backed by Nvidia, raised $3.36bn in September ahead of a New York listing that could value it near $35bn. Its flagship Glomfjord site in Norway is also behind schedule, with only 6.4MW of a planned 30MW online, according to Bloomberg. Former deputy prime minister Nick Clegg and former Meta operating chief Sheryl Sandberg sit on the board.

Baxtel tracks 607 data centers across the United Kingdom, operated by 219 providers; the largest is Vantage's CWL13 in Cardiff at 80 MW.

For developers, Loughton restates a hard lesson. Capital and GPUs move faster than the grid, and an anchor tenant will not wait more than five years for a connection. The UK's AI strategy leaned on two Nvidia-backed neoclouds, Nscale and CoreWeave, to build sovereign capacity. One of those anchor deals has now dissolved before the first rack was powered.

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