Microsoft quits Nscale's Loughton site, planned as the UK's biggest AI supercomputer

Microsoft has ended its agreement to use Nscale's planned AI data centre at Loughton in Essex, the site meant to hold the UK's largest AI supercomputer, the Telegraph reported on 18 October. Reuters, via Business Standard, said Microsoft declined to comment.

What was planned

The project was announced in September 2025 as part of Microsoft's roughly $15 billion push into UK AI infrastructure by 2028. According to Data Center Dynamics, Microsoft said the Loughton supercomputer would use about 23,000 Nvidia Grace Blackwell chips, with Nscale planning 50 MW of IT capacity on a site with a 90 MW power allocation. Nvidia put the chip count above 24,000.

Why it fell apart

The Telegraph reported repeated delays and said grid officials told Nscale they did not expect to supply power to the site until the 2030s. It did not say why Microsoft walked away.

Nscale said its relationship with Microsoft "remains strong and long-term", blamed a London-wide grid problem, and said other contracts are not affected. It is looking at other power sources for Loughton and its other UK sites.

The IPO angle

Nscale, which is backed by Nvidia, filed for a US stock market listing last month. Its prospectus names Microsoft and Anthropic as expected major customers and reports more than $103 billion in contracted value. Losing a headline site weeks before a listing is a test of how investors read that figure. Nscale competes with CoreWeave, Nebius, Crusoe and Lambda in renting AI computing power.

Why it matters beyond Britain

The story shows that electricity, not chips, is now the limit on how fast AI data centres can be built. Grid connections in the UK, Europe and the US are queued for years, and companies are chasing sites wherever power is available. For any country that wants AI data centres, including Pakistan, the lesson is that a reliable grid connection at a price that works matters as much as tax breaks or land. Big operators now pick sites by where they can get hundreds of megawatts quickly, and a site without that power is worth little however good its location.

For a sense of what electricity costs at home, run your own units through our electricity bill calculator.