Nscale’s £2bn UK data centre stalled by grid delays

TL;DR:

• Nscale has been told an electricity supply will not be ready in time to open its £2bn Essex data centre next year.
• The company is in talks with Bloom Energy about powering the site with gas fuel cells instead of waiting for a grid connection.
• More than 100 UK projects have now said they will turn to gas as connection backlogs stretch to a decade or longer.

Britain’s congested electricity grid has hit a £2bn data centre championed by Sir Keir Starmer. Nscale — the £11bn ($15bn) British firm backed by Nvidia — has been told power will not be available in time to open its Loughton site in Essex next year, and is understood to be seeking alternative supply.

Gas as the workaround

Nscale is in discussions with Bloom Energy, a US company whose solid oxide fuel cells generate electricity from natural gas without the usual combustion emissions — technology partly developed by Nasa for the Apollo missions. Demand has driven Bloom’s shares up 800% in a year, and it has already installed cells at a Manchester data centre and Dorset’s Wytch Farm oil field.

The site has planning permission and a 90-megawatt supply in the pipeline, but that is not expected before the 2027 target date. Microsoft is the anchor tenant, and the project was announced by Sir Keir during Donald Trump’s state visit last year as “Britain’s largest AI supercomputer”.

The delay fits a pattern Resultsense has tracked closely. Britain’s grid has grown more congested as renewable projects queue to connect under Labour’s net-zero targets, with Energy Secretary Ed Miliband aiming for 95% clean power by 2030. Some developments have been told to wait a decade or longer — the same bottleneck behind warnings that half the world’s mega data centre projects may stall and the open question of whether Britain can actually power its AI growth zones.

Nscale, run by former crypto entrepreneur Josh Payne, has drawn scrutiny for raising billions despite never having built a data centre from scratch. Its planned OpenAI facility in Northumberland was suspended after the ChatGPT maker cited high energy costs; last week it secured a £671m ($900m) credit facility to speed construction.

Looking forward

Nscale says it remains fully committed to the Essex site. But the retreat to gas — now the fallback for more than 100 UK projects — sits awkwardly beside the net-zero grid it is meant to complement. Whether ministers can clear the connection queue fast enough to keep flagship compute on the grid, rather than off it, is fast becoming the defining constraint on Britain’s AI ambitions.