Microsoft has withdrawn from an agreement to lease capacity at a planned AI data center in the UK from Nscale Global Holdings, a cloud provider preparing for an initial public offering. Reports say delays in securing adequate power could mean the site’s grid connection is unavailable until the 2030s.
The decision is a setback for Nscale, which counted Microsoft as a key tenant, and for the UK’s ambitions to lead in AI infrastructure. Microsoft said the decision concerns one site and that its partnership with Nscale remains strong. The cancellation highlights how power availability is becoming a major bottleneck for the AI industry’s expansion plans.