EU data centres will become a central part of Europe’s technological sovereignty strategy, after the European Commission presented a package aimed at expanding cloud, artificial intelligence and semiconductor capacity while reducing dependence on foreign technology providers.
The package, announced by the European Commission, includes two legislative proposals — the Cloud and AI Development Act and Chips Act 2.0 — together with a new open-source strategy and a roadmap for digitalisation and AI in the energy sector. Its most visible target is to at least triple the EU’s data centre capacity within five to seven years, with a focus on sustainable infrastructure.
Why EU data centres are now a strategic priority
The EU executive is framing digital infrastructure not only as an economic issue, but as a matter of security, resilience and political autonomy. Artificial intelligence, cloud computing and data processing increasingly support public services, health systems, energy grids, financial infrastructure and defence-related activities.
Commission President Ursula von der Leyen said Europe “cannot afford to depend on others for the technologies that keep our hospitals running, our energy grids stable and our services secure”. In the Commission’s view, technological sovereignty means ensuring that Europe can develop, deploy and protect key digital technologies without excessive reliance on external suppliers.
The package reflects a broader shift in Brussels. For years, Europe’s digital policy was mainly associated with regulation of large technology platforms. The new plan gives more weight to industrial capacity: data centres, cloud services, AI computing power, semiconductors and open-source technologies.
A plan shaped by dependence on USA tech giants
The strategy comes at a time when Europe’s digital infrastructure remains heavily dependent on large USA-based companies. Amazon, Microsoft and Google dominate much of the cloud market used by European businesses and public administrations, while Apple and Meta remain central to the broader digital ecosystem.
This dependence has become more politically sensitive as relations between the EU and the USA have become less predictable. Concerns in Brussels and several member states now focus not only on competition, but also on data control, extraterritorial legislation and continuity of critical services.
EU digital chief Henna Virkkunen has said the goal is not to exclude foreign providers from the European market. However, she also stressed that in “very critical” sectors, European actors should be able to control both the services and the data. Under the proposed framework, critical public contracts and sensitive sectors such as defence, banking, healthcare and energy could face stricter sovereignty requirements.
For cloud providers, this could mean stronger rules on where data is stored, who controls the infrastructure and whether software and hardware used in critical services are made or controlled in Europe.
Chips, cloud and open source in the same package
The Cloud and AI Development Act is designed to attract investment into European cloud and data centre infrastructure. It is linked to the Commission’s wider AI Continent Action Plan, which includes up to five AI gigafactories and an InvestAI facility intended to mobilise €20 billion in public and private investment.
The Chips Act 2.0 aims to strengthen Europe’s semiconductor ecosystem. The EU already adopted its first Chips Act in 2023, but Brussels argues that dependence on external suppliers remains too high. The new proposal is expected to support European chip manufacturers, improve supply-chain resilience and encourage long-term agreements between producers and buyers.
The package also includes an Open Source Strategy, intended to reduce dependence on proprietary technologies and support European alternatives. Open-source software is seen by the Commission as a way to increase transparency, interoperability and strategic control, especially for public administrations.
Together, these measures are meant to support Europe’s ambition to become an AI continent. But the goal is not only to produce more AI applications. It is to build the infrastructure needed to train models, process data and provide cloud services under European rules and control.
The Nordic question: clean power, cold climates and grid pressure
The Nordic countries are likely to be directly affected by the EU’s push. Denmark, Sweden, Finland and Norway have already attracted data centre investment because of their cooler climate, relatively clean electricity mix and strong digital infrastructure.
However, the same factors that make the region attractive also expose a growing tension. Data centres require large and stable electricity supplies. In countries where electrification, green industry and defence needs are also expanding, grid access can become a political issue.
Denmark offers a clear example. The Danish government has moved to prioritise critical social needs such as defence, healthcare, housing and green transport over large power-consuming data centres in the electricity grid queue. The measure reflects a wider European dilemma: technological sovereignty requires more computing infrastructure, but that infrastructure must compete for electricity, land and grid capacity.
Sweden and Finland may also face similar pressures as AI-related infrastructure expands. Northern Sweden has become attractive for energy-intensive projects, including AI data centres, while Finland’s location and energy profile have made it part of the wider European data centre map. Norway, with abundant hydropower, has also seen debate over whether electricity should be reserved for traditional industries, households or new digital infrastructure.
Sustainability will decide whether the plan can work
The Commission says the expansion of data centre capacity should prioritise sustainable data centres. This is essential for the credibility of the plan. Data centres can support digital resilience, but they also consume large amounts of electricity and water, and they can intensify pressure on already congested grids.
Across Europe, grid operators are dealing with rising demand from electrification, renewable energy projects and new industrial loads. In some countries, connection queues have already slowed investment. If the EU wants to triple data centre capacity, it will also need faster grid expansion, clearer permitting rules and stronger incentives for energy-efficient facilities.
This makes the package both an industrial strategy and an energy policy challenge. Europe’s AI ambitions depend on infrastructure that is not only sovereign, but also physically possible to build.
A sovereignty agenda still facing negotiations
The Commission’s proposals are not yet law. They must be negotiated with the European Parliament and the Council of the European Union, where member states may differ on how far Europe should go in favouring European providers and limiting dependence on USA-controlled infrastructure.
Some governments and companies may support stronger sovereignty rules for critical sectors, while others may worry about costs, reduced competition or retaliation from trade partners. USA technology companies have already developed European cloud models and localised services to respond to sovereignty concerns, but Brussels appears determined to move beyond voluntary solutions.
The debate will now test how Europe defines technological sovereignty in practice. The EU wants more data centres, cloud capacity, AI infrastructure, chips and open-source tools. The harder question is whether it can build them quickly enough, sustainably enough and with enough political unity to reduce dependence without closing itself off from global technology markets.
