Microsoft withdraws from £2 billion AI data center project in the UK

Decision to withdraw

Microsoft has withdrawn from an AI data center project planned by Nscale in Loughton, Essex, UK, with a £2 billion investment. According to the BBC, the company was to finance a supercomputer at the facility.

Microsoft did not comment on the matter. Nscale announced that it will continue with its plan to build the project.

Power connection delay

The data center's power connection was planned to be provided by the end of 2026. However, Nscale was told that the connection could be delayed until the 2030s. The delay, first reported by The Telegraph, shows that AI data centers are constrained not only by investment but also by power infrastructure.

Nscale said that electricity grid problems across London do not affect its other contracts. The company stated that it is exploring alternative energy sources for the Loughton facility and evaluating other expansion sites in the UK.

Other projects continue

Nscale said it continues to work with Microsoft on projects in Norway, Portugal and the US. The Loughton data center is expected to provide permanent employment for 250 people once operational.

Last month, Microsoft announced a $30 billion investment in the UK, part of which was to be used to finance the supercomputer in Loughton.