The European Commission said a call for proposals is expected to be approved shortly after thorough preparations. Credit: RaffMaster / Shutterstock.com
The European Union’s (EU) flagship initiative to build five large-scale artificial intelligence (AI) data centres is facing delays and a significant drop in corporate interest, Bloomberg reported, citing sources.
The programme, valued at €20bn ($23.23bn), centres on constructing at least five so-called gigafactories, each capable of housing around 100,000 advanced chips and delivering one gigawatt of power capacity.
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The EU has committed €4.1bn ($4.8bn) in subsidies, with the remainder to be provided by host member states and private investors.
A bidding round originally scheduled for May has been deferred to July, according to Polish digital minister Dariusz Standerski, who is involved in EU negotiations on the project.
Financing constraints add a further complication: available funding is sufficient to support no more than two of the five planned facilities ahead of the EU’s next multi-year budget cycle, which begins in 2028.
Subsidy disbursements are structured in two tranches, in 2028 and 2030 respectively.
Corporate appetite for the initiative has cooled markedly.
The pool of interested companies has contracted from around 70 at the outset to approximately ten groups expected to submit bids – with each participating country restricted to a single entry.
Uncertainty over demand projections and subsidy timelines has deterred a number of prospective participants.
Among those that have pulled back is the Schwarz Group, the privately held owner of supermarket chain Lidl, which had been weighing a lead role in a German consortium bid.
Sources cited in the report said the group was put off by the tender’s complexity and shifting parameters; it is currently developing a separate data centre south of Berlin.
Deutsche Telekom, which is independently expanding its Munich facility to 20,000 Nvidia GPUs, said it would only participate if customer demand were guaranteed.
Telefónica’s chief operating officer, Emilio Gayo, signalled a more modest involvement, saying the company is considering taking a stake of between 10% and 15% in the joint venture seeking subsidies.
In France, Mistral AI is in discussions to join a consortium pursuing a €10bn ($11.6bn) data centre project that would seek EU funding.
The difficulties come after earlier setbacks in EU technology policy.
The bloc’s 2022 Chips Act failed to meet its target of doubling Europe’s share of global semiconductor production by 2030.
Private investment is proceeding at a considerably faster pace.
SoftBank Group recently announced plans to commit up to €75bn ($87bn) to data centre infrastructure in France — a figure that dwarfs the entire EU programme.
The European Commission said a call for proposals is expected to be approved shortly after thorough preparations.
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