Microsoft drops the UK supercomputer that has no power

A showpiece on a scaffolding yard

On September 16, 2025, during Donald Trump's state visit to the UK, London start-up Nscale put out a press release featuring both Keir Starmer and Satya Nadella. With Microsoft, it announced the UK's largest AI supercomputer at Loughton, in Essex: 23,040 Nvidia GB300 chips, 50 megawatts expandable to 90, with chips due in the first quarter of 2027 to run the Azure cloud on this side of the Channel. The prime minister talked up sovereign computing capacity.

Six months later, according to The Register, the plot was still a scaffolding yard. Nscale has since cleared it. But a clean plot isn't a data center. It needs electricity, and that's where Nscale locates the snag, in what it calls an "unfortunate London-wide grid issue."

On October 19, 2026, Microsoft confirmed to Reuters that it had terminated its agreement on Loughton. The flagship supercomputer now has no announced customer, and still no power connection in sight.

What Microsoft said, and what it didn't

The Telegraph broke the story on October 18. The next day, a Microsoft spokesperson confirmed it to Reuters in a single sentence: "This decision relates to a single site." The company adds that it remains committed to its partnership with Nscale, with which it has other contracts in Europe and the US.

What Microsoft doesn't give is a reason. The electricity link is Nscale's, made in its own statement to Reuters and The Register: its relationship with Microsoft remains strong and long-term, and that "unfortunate London-wide grid issue" has no bearing on its other contracts. The company says it is still committed to Loughton and is looking at other power sources for the site.

So we have a split confirmed by one side and an explanation offered by the other. That's far sturdier than a rumor. It isn't an admission from Microsoft about its reasons.

The cable, not the chip

The power timeline has been circulating since September. According to the newsletter The Morning Intelligence, picked up by Euronews on September 29, UK Power Networks, the operator responsible for connecting the site, warned Nscale that the grid couldn't supply enough electricity before the early to mid-2030s. The site was due to start up in early 2027.

The operator won't comment on a particular connection, because the law forbids it. Its general answer to The Register says enough: plenty of data centers can plug into its distribution network, but they're waiting on upgrades to the national transmission grid, which it doesn't own. The building finds its socket in the neighborhood. It's the high-voltage line upstream that has run out of room.

And the queue is overflowing. According to the law firm Forsters, which analyzes the consultation regulator Ofgem launched on July 29, contracted connection requests rose from 41 gigawatts in November 2024 to 125 gigawatts in June 2025, about 73 of them for data centers. Peak demand across the whole of Great Britain is around 45 gigawatts.

Picture a restaurant that has taken nearly three times as many bookings as it has seats. Ofgem, for its part, proposes that large data center projects put down a deposit, refunded once they connect, to keep their place in the queue.

What Nscale's prospectus says

The timing is bad for Nscale. On September 18, it filed the prospectus for its New York IPO with the SEC, the US market regulator. We read it, and it explains the scene better than any press release.

As of August 31, 2026, Nscale reports $103.4 billion in contracts signed, in service or still to come. Only $2.6 billion of that is already live. In the first half of 2026, it booked $140.6 million in revenue and a net loss of $1.02 billion.

That backlog rests on two names. First Microsoft, with contracts signed between September 2025 and April 2026 that provide for up to $43.8 billion in payments through the end of 2033. Then Anthropic: on August 25, 2026, the maker of Claude signed four contracts worth up to $44.6 billion in total, for a campus in West Virginia.

The same document states that, as of its date, Nscale had no firm financing commitment for the chips and buildings these Anthropic contracts require. And if a tranche falls behind, Anthropic can cancel it without penalty. A backlog is a bit like a wedding registry: nothing is paid until the gift is delivered. Loughton shows what happens when delivery depends on a third party.

The prospectus never names Loughton. Its table of sites includes a line reading "United Kingdom, owned, 50 megawatts, contracted," which matches the description: the country, the ownership, the capacity. That was as of August 31, and no amended filing has followed.

Anthropic as the relief, in the conditional

The same day, October 19, Bloomberg reported, citing people familiar with the matter, that Anthropic and Nscale were close to announcing a second contract worth about $45 billion. According to TechCrunch, which picked up the story, those sources caution that talks are continuing and the details could change. Neither Nscale nor Anthropic has commented.

The day before, again according to Bloomberg, investors were pushing back on the roughly $30 billion valuation Nscale is seeking for its IPO. Neither piece of news was put out by either party. Treat them for what they are: the mood around a deal, not established facts.

What is written down, on the other hand, is the dependence. Nscale admits it in its risk factors: any drop in demand from Microsoft or Anthropic would hurt its business. In 2025, its largest customer accounted for 73% of revenue.

The sovereign plugged into someone else's socket

That leaves Keir Starmer's pitch. The UK's biggest supercomputer was meant to be run by a British company but filled by an American customer to power its cloud. The other half of the September 2025 announcement, Stargate UK with OpenAI, lost OpenAI in April 2026, according to the same prospectus.

We've already asked what a sovereign cloud would really cost, and what data centers take from the regions that host them. Loughton adds a more down-to-earth piece: a country's digital sovereignty is also decided at the grid operator's counter, and in the financial engineering of the people who build, which we looked at in what the SEC actually wrote.

The chips were due in the first quarter of 2027. As for the power, nobody has given a firm date yet.