The UK government has actively urged local officials to approve a £2 billion data centre project co-developed by Microsoft and the British AI start-up Nscale, illustrating the high-level support for expanding the country’s digital infrastructure. In November, Lord Stockwood, the investment minister, sent a letter to Andrew Small, chief executive of Epping Forest District Council, emphasizing the government’s strong backing of the proposed “supercomputer” facility on the outskirts of Loughton, Essex.
The push came despite opposition from local councillors, committees, and residents concerned about the environmental impact, including strains on water and power supplies as well as the site’s effect on the local landscape. Nevertheless, the council granted planning permission last month, describing data centres as critical national infrastructure.
Sir Keir Starmer had previously highlighted the project during former U.S. President Donald Trump’s state visit to Britain in September 2025, tying it to Microsoft’s $30 billion (£22 billion) investment commitment in the UK. Lord Stockwood’s letter referenced this announcement, noting the facility’s role in UK–US technological cooperation and the government’s goal to position Britain as a leader in digital technologies.
Nscale, valued at approximately $15 billion, is among Britain’s most valuable AI start-ups, with high-profile figures such as Sir Nick Clegg and Meta’s former chief operating officer Sheryl Sandberg recently joining its board. The company aims to build a data centre featuring tens of thousands of Nvidia chips, originally expected to be operational in 2026 but now delayed until 2027.
The project involves upgrading a previously approved data centre on a former scaffolding yard, enlarging the facility and enhancing its computing power. However, the local council had raised multiple concerns about the expansion, including potential challenges to local water and electricity infrastructure, as well as urban design considerations.
Government support for data centres has extended to facilitating improved power connections and, in some cases, enabling developers to bypass local opposition through development consent orders determined by the Housing Secretary, Steve Reed. Reed recently authorized a data centre in Kent to move forward despite local council resistance.
Nscale’s investors include major technology companies such as Nvidia, Dell, and Nokia. However, the firm’s efforts to expand data centre operations in the UK have encountered obstacles. Earlier this year, a joint project with OpenAI in the northeast of England was cancelled due to the high cost of electricity.
Concerns about environmental and community impact also persist elsewhere. In Devon, farmers have opposed plans by Xlinks to construct the UK’s largest data centre in Great Torrington, citing worries over landscape disruption and significant water use. Data centres across the country currently consume more than 14 million litres of water daily.
An Nscale spokesperson reaffirmed the company’s commitment to the Loughton project, indicating that despite delays and challenges, they remain focused on delivering the facility.