EU Allocates Ten Billion Euros for Seven AI Gigafactories

Denmark, the Czech Republic, Finland, France, and Poland are participating in the first tender round. According to the EU Commission, eight additional member states have expressed interest in participating. The exact locations and operators are to be selected in the coming weeks. The Commission expects that large private players such as Microsoft or Amazon will also join the consortia required to operate the facilities.

What Are AI Gigafactories?

"Gigafactories" in the industry refer to particularly large, high-performance data centers in which tens of thousands of specialized AI chips operate in parallel. Such facilities consume enormous amounts of electricity and require complex cooling. As things stand, each site is planned to have computing capacity in the high single-digit gigawatt range. The EU Commission hopes this will yield economies of scale and lower operating costs compared to many smaller, decentralized sites.

Reactions from Politics and Industry

Henna Virkkunen, had described the project in recent months as one of the central initiatives of her term in office. She sees it as a prerequisite for European start-ups and medium-sized companies to gain access to sufficient computing capacity to develop their own AI models and not be dependent on providers outside the EU.

Industry representatives point out that both the US and China have invested massively in AI infrastructure in recent years. The US government is promoting the expansion of large data centers through programs such as the "Stargate" initiative, while China treats the build-up of national AI computing capacity as a strategic priority. Without its own gigafactories, the argument goes, Europe risks falling behind in the medium term.

Outlook: Site Selection Expected by End of Year

The Commission emphasizes that the allocation of funds will be tied to clear conditions. These include requirements for energy efficiency, the use of renewable energies, and transparency vis-à-vis European supervisory authorities. In addition, European companies are to be given preference if they submit competitive bids.

The first contracts with the selected consortia are to be signed later this year. The first facilities are not expected to become operational before 2028. Observers see the program as the EU's most ambitious attempt to date to build independent capacity in the global AI race – and at the same time as a test of whether the single market is capable of coordinating projects of this magnitude.

The training of skilled workers and the promotion of European semiconductor supply chains are also to receive greater focus. Even with the planned gigafactories, officials acknowledge, Europe will continue to rely on imports for high-performance chips.