OpenAI is pausing its UK data center project, citing high energy costs and regulatory conditions.

The multibillion-dollar Stargate project is part of the ChatGPT maker’s expanding AI infrastructure buildout, but the pullback marks a blow to Prime Minister Keir Starmer’s efforts to make the UK a global AI hub. One opposition lawmaker called it a “wake-up call” for the government.

The pause also reflects a shift in OpenAI’s investment strategy: The startup isn’t planning to expand its main Stargate data center in Texas, and recently shut down its AI video app as it looks to refocus around coding and business users, amid intensifying competition with rivals Anthropic, Google, and Meta.