Microsoft ends Nscale Loughton data center deal after grid delay

Microsoft ended its agreement for Nscale’s planned Loughton data center after Nscale was told the Essex site’s electricity connection was not expected until the 2030s, spokespeople for the companies confirmed. The decision removes Microsoft from a project that had been scheduled to supply Azure services in the UK from the first quarter of 2027.

Microsoft said the termination applies to one site and that its broader work with Nscale continues. Nscale said the grid problem does not affect its other Microsoft contracts, and that it is exploring alternative power sources for Loughton and other UK expansion sites.

Nscale and Microsoft announced the Loughton project in September 2025 with 50 megawatts of initial AI capacity, scalable to 90MW. The companies planned to deploy 23,040 Nvidia GB300 GPUs at the site for Microsoft Azure services.

Nscale announced a wider Microsoft infrastructure agreement the following month, listing separate deployments in Texas, Sines in Portugal and Narvik in Norway. Those announcements show that the commercial relationship extends beyond Loughton, but do not independently establish the current delivery status of each project.

The Loughton delay comes amid pressure on Britain’s electricity-connections pipeline. Ofgem said data center applications drove much of a rise in contracted demand from 41GW to 125GW between November 2024 and June 2025. The regulator said data center projects accounted for at least 80GW in the queue.

The National Energy System Operator said Britain’s former connection queue had grown to about four times the capacity needed for 2030, and that a place in the queue did not guarantee a realistic route to connection.