OpenAI is pausing its Stargate infrastructure project in the UK, citing the high cost of energy and the challenging regulatory environment.
First reported by Bloomberg this morning, the ChatGPT-maker said it would be pausing the project as it reins in ambitious spending plans ahead of its much-anticipated public listing.
“We see huge potential for the UK’s AI future,” the company said in an emailed statement on Thursday. “AI compute is foundational to that goal – we continue to explore Stargate UK and will move forward when the right conditions such as regulation and the cost of energy enable long-term infrastructure investment.”
An OpenAI spokesperson told CNBC: “We see huge potential for the UK’s AI future. In the meantime, we are investing in talent and expanding our local presence, while also delivering on the commitments under our MOU with the Government to adopt frontier AI in UK public services.”
The news comes after delays to the project were announced earlier in the week, with several large-scale OpenAI developments – including Stargate – being pushed back. Designed to play host to thousands of Nvidia AI processors, the Stargate UK project has been met with some criticism, with some suggesting the deal may be overhyped or that power shortages could act as a barrier to progress.
Challenges like electricity are a proven challenge across Europe currently, with many regions lacking the power and capacity required to fuel large AI data centre facilities.
OpenAI’s news will certainly come as a blow to the UK government, which has committed itself to becoming more of a leader in AI technology. The country, which has already been accused of lagging in AI growth, is investing further into AI and quantum as significant ‘economic renewal’ sectors for the country.
The UK has also invested into data centres to fuel such as growth, although faces the same battles as the rest of Europe with land and power constraints and recent so-called ‘phantom investments’ making headlines last month.
The Stargate UK initiative, introduced last year, formed a significant part of plans to power the UK’s future economy and boost global competitiveness in AI, as OpenAI said its models would run on local computing power in the UK.
Speaking at the time, OpenAI CEO Sam Altman said: “The UK has been a longstanding pioneer of AI, and is now home to world-class researchers, millions of ChatGPT users and a government that quickly recognised the potential of this technology.”
He added: “Stargate UK builds on this foundation to help accelerate scientific breakthroughs, improve productivity, and drive economic growth.”
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