Microsoft cancels its anchor-tenant deal for Nscale’s Loughton (Essex) AI data centre over grid delays, weeks before Nscale’s planned $35B IPO
Partly confirmed
The takeaway
On Oct 18, 2026 the Telegraph reported that Microsoft had cancelled its agreement to anchor Nscale’s planned Loughton, Essex data centre, where it was to rent about 23,000 Nvidia AI chips.
Status
- Claim
Partly confirmed
- Our reporting
- Medium confidence
- Importance
- 3 of 5
- Last verified
- 18 October 2026
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Key facts
- Telegraph exclusive (James Titcomb, Oct 18): ‘Microsoft cancels UK data centre deal with Nscale. Comes just as Nscale hopes to pull off a $35 billion IPO’ (his X post: ~61k views on Oct 18)
- Techmeme summary: Microsoft was to be the anchor tenant and rent 23K Nvidia AI chips at a planned data centre facing repeated delays in Essex, UK
- Per Crypto Briefing (summarising the Telegraph, Oct 18): ~£2B site designed for about 90 MW, slated to open in 2027; reason given is grid connection (UK Power Networks cannot supply sufficient power until the early-to-mid 2030s), not chips, demand or a dispute; the site has no announced customer now and Nscale says it remains committed and is seeking alternative power
- Per Crypto Briefing: Nscale reports a $103.4B contracted backlog, about $43.8B of it from Microsoft; ~55 MW operating in Europe; at Glomfjord, Norway, 6.4 MW live of a planned 30 MW, with delays triggering penalties
- Reaction: UK commentators on X blamed grid-connection failures (one post: ‘Billions of pounds lost on a single project because we can’t connect it to the grid for half a decade’, ~56k views)
What happened
The Telegraph reported on Sunday Oct 18 that Microsoft had pulled out of its role as anchor tenant at Nscale’s planned AI data centre in Loughton, Essex. Bloomberg and Reuters followed, both citing the Telegraph. The Telegraph article itself was paywalled and could not be read for this entry; the details on power, size and backlog come from Crypto Briefing’s summary and Techmeme’s headline (confidence: medium). Neither Microsoft nor Nscale is quoted directly in the sources we read.
Why it matters
Nscale filed for a NYSE IPO in September and depends heavily on Microsoft and Anthropic contracts, so losing an anchor tenant weeks before listing tests its pitch. It is also a concrete case of power and grid connections, not chips, limiting AI build-outs. The same day the FT reported, citing RegLayer, that 47+ large US data centre projects were delayed, withdrawn or blocked in 2026.
Sources
6 sources from 5 sites. Numbers match the chips in the text.
6 sources: 4 press, 2 reactions
Press
- Telegraph: Microsoft axes AI deal in setback for UK data centre pioneer (Oct 18; not readable to us)telegraph.co.uk, press
- Crypto Briefing: Microsoft scraps UK data center deal with Nscale, putting IPO plans at riskcryptobriefing.com, press
- Bloomberg: Microsoft scraps UK data center deal with Nscale, Telegraph says (paywalled)bloomberg.com, press
- Reuters: Microsoft pulls out of UK data center deal with Nscale, Telegraph reportsreuters.com, press
Reactions
- James Titcomb on X: exclusivex.com, discussion
- Discussion on X: grid connection as the causex.com, discussion
Changes
- Filed