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Microsoft withdraws from Essex AI datacentre over power supply constraints

Microsoft has ended its agreement with Nscale for the planned Loughton facility, identified by the UK government as a major sovereign AI hub. The withdrawal, reported by The Telegraph, leaves Nscale without its anchor tenant due to grid connection delays.

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Microsoft has pulled out of a data centre deal with British cloud provider Nscale, The Telegraph reported. The decision is linked to power supply concerns regarding the planned facility at Loughton in Essex, which was scheduled to open next year.

The project was highlighted in Keir Starmer’s government’s 2025 AI strategy as the “largest UK sovereign AI datacentre.” With Microsoft's departure, Nscale has lost its only publicly announced customer for this specific Essex site, despite backing from other tech firms including Nvidia.

Sources3

Original reporting and primary evidence.

  1. TheGuardianPrimary sourceMicrosoft pulls out of AI datacentre project in Essex over power supply concerns
  2. www.msn.comMicrosoft pulls out of UK data center deal with Nscale, Telegraph reports
  3. www.msn.comMicrosoft pulls out of UK data center deal with Nscale, Telegraph reports
Claim connections3

Microsoft has pulled out of a data centre deal with British cloud provider Nscale.

confirmed
Connected sources1

The Loughton project was highlighted in Keir Starmer’s government’s 2025 AI strategy as the “largest UK sovereign AI datacentre”.

confirmed
Connected sources1

Nscale has lost its only publicly announced customer for the Essex datacentre following Microsoft's withdrawal.

confirmed
Connected sources1