Large wooden cable drum in a muddy Essex field with a black power cable that stops short of a distant lit data centre, beside electricity pylons at dusk

Data Centre Grid Connection Delays: Microsoft Exits Nscale’s Loughton Site

23 October 2026

Microsoft has walked away from anchoring Nscale’s flagship Loughton site in Essex, and the reported reason is a data centre grid connection that may not arrive until the early-to-mid 2030s.

The Telegraph broke the story on Sunday 18 October, and Microsoft confirmed the withdrawal the following day, saying the decision relates to a single site. Nscale says it remains committed to Loughton and is exploring alternative power sources.

What was planned at Loughton

A 50MW facility, expandable to 90MW, announced in September 2025 as part of Microsoft’s UK investment package.
23,040 Nvidia GB300 GPUs, with first chips expected in early 2027, according to The Register.
Microsoft as the only publicly named customer, so its exit leaves the site without an announced tenant.

Why a data centre grid connection takes so long

UK Power Networks does not discuss individual connections, but it told The Register that many data centres can connect to its distribution network yet are waiting for works on the national transmission network, which it does not own.

The wider queue explains the pressure. Ofgem reported that contracted demand offers rose from 41GW in November 2024 to 125GW in June 2025, and data centres account for a large share of that. Reform is under way: NESO’s two-gate process gives a dated offer only at Gate 2, once readiness and strategic alignment tests are met, although these rules apply to transmission connections rather than distribution. Ofgem has also consulted on a commitment fee and queue milestones specific to data centres, with the consultation closing on 16 September 2026, as Browne Jacobson sets out.

What to watch next

Whether Nscale names an alternative power source, a new tenant or a revised delivery date for Loughton.
Where Microsoft places the GPU capacity it had lined up.
The outcome of Ofgem’s demand connections reform and how readiness is judged.
Whether more developers choose on-site gas generation rather than wait, a route already reported in the UK market.

A fair reality check

Microsoft has not publicly given grid delay as its reason, and the 2030s timeline is reported rather than confirmed by the network operator. Nscale describes it as a London-wide grid issue with no effect on its other contracts, and a person familiar with the matter told AFP that Loughton was only a small part of Microsoft’s agreements with Nscale. This is one site, not a verdict on UK data centres as a whole.

GO-IBR Research Team take

Connection date, not chip supply, is becoming the critical-path item for large UK loads. Developers will need a credible grid timeline before they sign anchor tenants, and network owners will be judged on how quickly transmission works can be sequenced. Queue reform is aimed at the right problem, but it rewards readiness, so sites that cannot show secured power will struggle to hold customers while the works catch up.

Last updated 23 October 2026. Sources: The Register, Capacity, AFP via Kuwait Times, Bernama, DCD, Hogan Lovells, Browne Jacobson.