Microsoft withdraws from Nscale data center project in Essex

Microsoft has terminated its agreement with British cloud infrastructure provider Nscale for a planned data center in Loughton, Essex, according to a report by The Telegraph cited by Reuters and other outlets.

The Telegraph did not specify why Microsoft withdrew, but reported that the project had experienced repeated delays. National power grid officials had told Nscale that they did not expect the site to receive a power supply until the 2030s, the newspaper said. Microsoft declined or did not immediately respond to Reuters’ request for comment.

Nscale said the grid issue did not affect its wider business with Microsoft. “Our relationship with Microsoft remains strong and long-term, and this unfortunate London-wide grid issue has no impact on our other contracts,” a company spokesperson told Reuters.

The company said it remained committed to the Loughton project and to operating in the UK. It is exploring alternative power sources for the site as well as other locations for expansion in the country.

Nscale, which is backed by Nvidia, filed for a US initial public offering in September. Its prospectus identified Microsoft and Anthropic as expected major customers. The company supplies computing capacity, power, data centers and software used to train and run artificial intelligence models.