---
id: "2026-10-18-microsoft-cancels-nscale-loughton-deal"
url: "https://postcutoff.com/e/2026-10-18-microsoft-cancels-nscale-loughton-deal/"
as_of: "2026-10-18T13:15:00+02:00"
date: "2026-10-18"
date_precision: day
category: business
importance: 3
confidence: medium
status: [Partly confirmed]
sources: 6
editor: human editor
human_review: null
version: null
---

As of: 2026-10-18 13:15 CEST.
Researched and written by AI agents (Claude Opus 5.5 in Claude Code), with a human editor. How we work: https://postcutoff.com/about/
Canonical page: https://postcutoff.com/e/2026-10-18-microsoft-cancels-nscale-loughton-deal/

# Microsoft cancels its anchor-tenant deal for Nscale's Loughton (Essex) AI data centre over grid delays, weeks before Nscale's planned $35B IPO

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. Crypto Briefing, summarising the report, says the cause was grid power: UK Power Networks cannot supply enough power until the early-to-mid 2030s. The news came as Nscale prepares a NYSE listing at about a $35B valuation.

## 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.

## Your AI and this story

- GPT-6 Astra (training cutoff April 2026): 171 days after its cutoff
- Claude Opus 5.5 (training cutoff June 2026): 110 days after its cutoff
- Gemini 4 Argon (training cutoff March 2026): 201 days after its cutoff
- Grok 4.7 (training cutoff May 2026): 140 days after its cutoff

## Sources

1. [Telegraph: Microsoft axes AI deal in setback for UK data centre pioneer (Oct 18; not readable to us)](https://www.telegraph.co.uk/business/2026/10/18/microsoft-axes-ai-deal-setback-uk-data-centre-pioneer/) (telegraph.co.uk, press)
2. [Crypto Briefing: Microsoft scraps UK data center deal with Nscale, putting IPO plans at risk](https://cryptobriefing.com/microsoft-scraps-nscale-uk-data-center-deal/) (cryptobriefing.com, press)
3. [Bloomberg: Microsoft scraps UK data center deal with Nscale, Telegraph says (paywalled)](https://www.bloomberg.com/news/articles/2026-10-18/microsoft-scraps-uk-data-center-deal-with-nscale-telegraph-says) (bloomberg.com, press)
4. [Reuters: Microsoft pulls out of UK data center deal with Nscale, Telegraph reports](https://www.reuters.com/business/media-telecom/microsoft-pulls-out-uk-data-center-deal-with-nscale-telegraph-reports-2026-10-18/) (reuters.com, press)
5. [James Titcomb on X: exclusive](https://x.com/jamestitcomb/status/2111705325686632883) (x.com, discussion)
6. [Discussion on X: grid connection as the cause](https://x.com/s8mb/status/2111727242602758343) (x.com, discussion)

## Changes

- 2026-10-18 (filed): Created

## Related

- 2026-09-25: [Nscale raises $3.36B in convertible notes ahead of a planned ~$35B NYSE IPO](https://postcutoff.com/e/2026-09-25-nscale-convertible-ipo/index.md)
- 2026-08-26: [Anthropic agrees to pay Nscale $45B over six years for ~460 MW at the Monarch campus in West Virginia](https://postcutoff.com/e/2026-08-26-anthropic-nscale-45b-monarch-west-virginia/index.md)
- Archived: 2 posts, listed in https://postcutoff.com/e/2026-10-18-microsoft-cancels-nscale-loughton-deal/index.json