Microsoft Walks From a Site the Grid Can’t Power

LONDON, Oct. 18 — Microsoft,Microsoft, the expected anchor tenant, has pulled out of Nscale’s planned AI data center at Loughton, Essex, over concerns about power supplies, The Guardian reported on Sunday. The local grid operator, UK Power Networks, had told Nscale it could not supply enough power to the site until the early to mid-2030s.NscaleA London-based “neocloud” that rents out computing on Nvidia’s chips. It was incorporated in May 2024, counts Nvidia among its backers and plans to list on the New York Stock Exchange as NSCL.

On Friday, a developer in Nova Scotia offered another approach. EverWind’s planned campus at Point Tupper, where Anthropic has signed a long-term lease for the initial phase, is to be backed by new wind farms and batteries, will be able to stop drawing from the grid when necessary and will pay the grid costs it causes, the developer says. Its wind farms will not be ready when the first phase opens.

The two announcements show how grid access, and plans to add generation, can shape where AI computing gets built. EverWind’s power commitments remain subject to provincial studies and approvals. Nscale’s own prospectus says its approach includes sites with “onsite powered micro-grid solutions, reducing reliance on constrained utility grids.”

Keir Starmer’s government held up the Loughton project in 2025 as the “largest UK sovereign AI datacentre.” Microsoft’s exit leaves Nscale without its only publicly announced customer there. The Guardian’s report carried no comment from Microsoft. The paper said “it is understood” that Microsoft remains on board for an Nscale project in Norway.MSFTNasdaq521.91▼8.23−1.6%Microsoft · Friday’s session

“We remain committed to both the Loughton project and the UK, and we are exploring alternative power sources for the site, in addition to other expansion sites in the UK,” an Nscale spokesperson said, as quoted by The Guardian. “Our relationship with Microsoft remains strong and long-term, and this unfortunate London-wide grid issue has no impact on our other contracts.”

Nscale’s filing places Microsoft capacity in Norway and Portugal, which it counts among its “renewable-rich, low-cost power regions.”

The Offering

Nscale has been seeking a valuation of about $30 billion, but a group of investors has urged $16 billion to $19 billion as “more likely to find favor with buyers,” Bloomberg News reported on Sunday, citing people familiar with the matter.

The prospectus, filed Sept. 18, shows a company growing fast and losing heavily: first-half revenue of $140.6 million, up from $10.4 million a year earlier, and a net loss of $1.02 billion. Its largest customer supplied 52 percent of that revenue. Its remaining performance obligations stood at $56.4 billion on June 30.BacklogRemaining performance obligations are contracted revenue not yet recognized. Nscale’s figure includes $7.1 billion from the financing component of customer prepayments, and it expects to recognize the total over the next seven years.

Two customers’ contracts dominate what lies ahead: Microsoft’s statements of work, worth up to about $43.8 billion through December 2033, and Anthropic’s agreements, signed on Aug. 25 and worth up to about $44.6 billion. The Anthropic work is at Nscale’s Monarch campus in West Virginia, which the filing says “can deliver up to 8GW of gross behind-the-meter power.”MonarchNscale acquired the 2,250-acre Monarch Compute Campus in Mason County, W.Va., when it bought AIPCorp in March 2026. It expects to develop up to 2 gigawatts of generating capacity there by the first half of 2028. As of the filing, Nscale had no binding commitments for the financing the Anthropic work requires, and Anthropic may cancel any tranche that misses specified delivery deadlines. The payments also depend on service availability: the filing describes service commitments stricter than those in Nscale’s other contracts, and rights for Anthropic to terminate if uptime falls short for sustained periods.

Nvidia is to buy $1 billion of Nscale’s convertible notes or non-voting shares, in a sale the filing says will close “on or around November 16, 2026.”NVDANasdaq204.64▼9.02−4.2%Nvidia · Friday’s session The filing’s price range is blank, and no amendment had appeared on EDGAR by early Monday.

Nova Scotia

EverWind, a Halifax-based wind and hydrogen developer, puts the plan at more than $10 billion, without naming the currency: more than $8 billion for the campus and $2 billion for four wind projects. It has not detailed completed financing; “each phase will be financed separately,” its chief financial and strategy officer, Matthew Tinari, told the Globe, with project debt. The campus is to open with 95 megawatts in late 2027 and add 325 megawatts, targeted for 2028, for 420 in all, subject to regulatory and other conditions.

EverWind’s release named only “a leading frontier AI developer”; Anthropic confirmed its involvement later on Friday, The Globe and Mail reported. The Canadian Press reported a 20-year lease for the first, 95-megawatt phase. “Our work with EverWind will help meet growing demand for Claude in Canada while bringing new clean energy onto the grid and protecting existing electricity customers,” Jacob Glick, Anthropic’s head of public policy in Canada, said in a statement quoted by the Globe.

EverWind says it will fully fund all connection, network upgrade and other electricity-system costs attributable to the campus, which will be designed to “reduce or stop drawing electricity from the grid when necessary.” It will add battery storage, and the expansion will not connect until provincial system studies and approvals are complete. Until the wind farms are ready, company officials said, a study by the province’s grid operator found existing infrastructure can support the first phase, The Canadian Press reported.The WindEverWind has environmental approvals for four wind farms in mainland Nova Scotia able to produce 650 megawatts. A First Nations consortium led by Membertou owns 51 percent of them, The Canadian Press reported.

Cooling is designed to be closed-loop and mostly by air. EverWind expects to use about 100,000 liters of water a day at first and 500,000 at full build-out, which it calls roughly 1 percent of the 34 million liters it identifies as nearby Landrie Lake’s safe daily yield; by this paper’s arithmetic, it is about 1.5 percent.

“Speed matters, and capable partners matter and this is something that we can do,” Trent Vichie, EverWind’s founder and chief executive, told a news conference, The Canadian Press reported.

Speed matters, and capable partners matter and this is something that we can do.

Premier Tim Houston backs the project. “The Houston government is supporting this project without any discussion, consultation, legislation or regulations,” Claudia Chender, the New Democratic opposition leader, said in a statement quoted by The Canadian Press.

The open questions are whether sites that bring their own power can win the tenants that sites waiting on the grid lose, and what investors will pay for a neocloud whose sites the grid cannot yet serve. The next markers are an amended Nscale filing with a price range, Nvidia’s closing on or around Nov. 16, and the Nova Scotia system studies that must be finished before EverWind’s expansion connects.

Daily Cortex is written with AI models, including Anthropic’s Claude, and fact-checked with OpenAI’s GPT models.