OpenAI halts 31 billion Stargate UK project over rising energy costs and regulatory deadlock

Date:
Fri, 10 Apr 2026 10:25:02 +0000

Description:
OpenAI says energy costs and regulation are forcing the company to put the project on hold - but was there even a project to begin with?

FULL STORY ======================================================================Copy link Facebook X Whatsapp Reddit Pinterest Flipboard Threads Email Share this article 0 Join the conversation Follow us Add us as a preferred source on Google Newsletter Tech Radar Pro Are you a pro? Subscribe to our newsletter Sign up to the TechRadar Pro newsletter to get all the top news, opinion, features and guidance your business needs to succeed! Become a Member in Seconds Unlock instant access to exclusive member features. Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners or sponsors By submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over. You are
now subscribed Your newsletter sign-up was successful Join the club Get full access to premium articles, exclusive features and a growing list of member rewards. Explore An account already exists for this email address, please log in. Subscribe to our newsletter OpenAI has paused its planned Stargate UK
data center project The company cited energy costs and regulation as causes for the halt Stargate UK was slated to be well underway by Q1 2026, but
little progress had been made OpenAI has pressed pause on its Stargate UK
data center project over rising energy costs and regulatory uncertainty in
the country.

The project would have seen a large data center built in north-east England, alongside 31 billion in wider tech investments across the UK. For now, Stargate UK will not be going ahead, but the project could resume if the
right conditions were to enable long-term infrastructure investment, an
OpenAI spokesperson said. Article continues below You may like OpenAI
promises to keep Stargate data center costs down - so your utility bills shouldn't go sky high...probably Oracle and OpenAI drop plans for mega Stargate AI US data center Iran is threatening to bomb the $30 billion Stargate AI data center What is Stargate UK? When announced in September
2025, OpenAI said Stargate UK would help power the UKs future economy, boost its global competitiveness and deliver on the countrys national AI Opportunities Action Plan.

The project, in partnership with Nvidia and Nscale, was scheduled to explore offtake up to 8,000 GPUs in Q1 2026 with the potential to scale to 31,000
GPUs over time, with Nvidia CEO Jensen Huang stating that the project would help the UK become an AI superpower. The project has missed this key milestone.

While it did not rival its US sister project in a similar scale of
investment, the UK project was expected to act as a catalyst for business growth and innovation. The construction of data centers and supercomputers within UK territory was also intended to help protect the sovereignty of British data - whether originating from research projects from educational institutions such as Oxford or enterprise AI development. Why has Stargate UK been paused? The main factors preventing the go-ahead of Stargate UK are the cost of energy, which has become the highest in Europe, and regulatory uncertainty. Are you a pro? Subscribe to our newsletter Sign up to the TechRadar Pro newsletter to get all the top news, opinion, features and guidance your business needs to succeed! Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners
or sponsors By submitting your information you agree to the Terms &
Conditions and Privacy Policy and are aged 16 or over.

Energy costs have risen steadily in the UK, with the war in Ukraine and the uncertainty surrounding the recent conflict in the Middle East contributing
to steep jumps in energy prices. The price of energy in the UK is set by the most expensive form of energy production, and the UK relies heavily on
natural gas for heat and power.

When supplies are threatened or when demand exceeds supply, the cost of natural gas rises and brings the wholesale cost of electricity in the UK up with it. OpenAI also listed a lack of dedicated infrastructure that would enable datacenters to access reliable energy supplies among reasons for putting the project on hold.

As for regulatory concerns, OpenAI omitted specifics in its statement. But
the concerns could surround the UK government's recent U-turn on AI copyright after proposed legislation received serious criticism and backlash from UK artists such as Sir Elton John and Dua Lipa. What to read next Solving AI's energy challenge: sustainable data centers for a competitive UK future
Planned Saudi megacity 'The Line', designed for 9 million people across
170km, could be redesigned as a far smaller data center UK government wants
to prioritize getting data centers access to the national grid

OpenAI has a history of publicly advocating for strong regulations on AI
while simultaneously lobbying to weaken AI regulations and advocating for voluntary commitments over legally binding regulation . A real project or a paper tiger? There are other questions surrounding the feasibility of the project. For example, Nscale - one of the partners in the Stargate UK project - was set to build a supercomputer that would open in 2026.

However, a Guardian investigation found development on the supposed site of the supercomputer had not started, and the site remained a scaffolding yard.

Despite Nscale having stated publicly it had purchased the site , at the
time, the scaffolding yard remained under ownership by a different company, with land records showing no evidence of Nscales ownership.

Additionally, the UK government issued a press release stating a 1.9 billion investment contract had been signed with Nscale. However, no such contract
was signed, and the government admitted that it was not playing an active
role in auditing these commitments.

The government also said that the full 2.5 billion investment earmarked for the development of the supercomputer was not a formal contract, rather an intention to commit capital.

The project has also been plagued by wider accounting errors, questionable contracts, and a lack of tangible commitments to investments . The best cloud storage for all budgets Our top picks, based on real-world testing and comparisons

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Link to news story: https://www.techradar.com/pro/openai-halts-gbp31-billion-stargate-uk-project-o ver-rising-energy-costs-and-regulatory-deadlock


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