Microsoft has cancelled plans to participate in a high-profile data centre project in Loughton, Essex, after the power supply to the facility was delayed.

The development, which is being carried out by London-based Nscale, was hailed by the government last year as the UK’s largest AI data centre, a centrepiece of the government’s plans to develop AI infrastructure within the country.

It was initially planned to begin operating next year, but concerns emerged in March 2026 when it was reported that the site was still operating as a scaffolding yard.

Power supply

Then, earlier this month, it emerged that UK Power Networks, which owns and maintains the power grid across London and the South-East of England, had informed Nscale that the site’s power connection would be delayed from the end of this year until the mid-2030s.

Microsoft had been the only publicly announced client for the planned data centre, and was expected to be its anchor tenant.

The company has since cleared the site and is currently investigating alternate power sources for the site or the possibility of speeding up the grid connection.

It said it remains “committed” to the Loughton project and the UK and is exploring additional expansion sites within the country.

Data centre expansion

The company added that its relation with Microsoft remains strong. Microsoft declined to comment.

The companies are continuing to work together on other projects in Norway, Portugal and the US.

Nscale has been seeking a US IPO, but it is unclear when the flotation might take place.

Several other high-profile firms, including smart ring maker Oura and Australian data centre operator Firmus, have recently cancelled plans for major IPOs.