The European Commission proposes to build seven large-scale artificial intelligence computing centres, so-called gigafactories. These centres are intended to provide researchers and startups with the computing capacity needed to train large language models and other advanced AI systems.
How much and who is contributing
Eighteen of the European Union’s 27 member states have so far pledged financial contributions totaling roughly €3 billion; nine member states have not yet committed. Hungary is participating via the Recovery and Resilience Facility (RRF) and has pledged €500 million.
The size of national pledges varies significantly:
- Germany is the most ambitious: Berlin allocated an additional €800 million, bringing Germany’s total national contribution to €1 billion.
- Portugal, Spain, Italy and Greece each plan to provide €200 million for larger centres.
- France, Denmark, Poland and the Czech Republic would each contribute €100 million for smaller gigafactory projects.
- Sweden pledged €50 million and Lithuania just €1 million for regional subprojects.
Several countries, including the Netherlands, cited tight national budgets and said they currently have no room for additional multi‑tens or hundreds of millions of euros in long‑term commitments.
Financing structure and risk mitigation
The programme foresees that EU and national public funds would only cover part of the investments: the public sector could fund up to 35% of total costs, with the remainder expected from private investors. Member states must also commit in advance to purchasing computing capacity from the centres that are built in their territories, effectively acting as guaranteed customers to lower the risk for private backers.
This approach is necessary because European projects start at a competitive disadvantage compared with the United States, where large tech players — such as OpenAI, Anthropic and Elon Musk’s xAI — are making sizeable private investments in data centres. High energy prices and longer permitting processes in Europe also reduce expected returns for investors.
Timeline and funding amounts
The European Commission is expected to select the seven winning projects in early 2027. Selected centres could initially receive €100–200 million in EU support, with the possibility of a further €400–800 million later. Actual national payments are planned to begin only once the centres start operating, likely around 2028, and will be spread over several years in national budgets.
Why it matters and the emerging debate
The gigafactory programme is becoming a test of EU industrial policy: if successful, it could help narrow Europe’s gap with US AI infrastructure; if it falters, countries that did not commit funding now may find themselves further from the centres of AI development. The debate therefore centers not only on which countries win the projects but also on whether Europe can mobilise sufficient public and private capital at the necessary speed and scale.
Conclusion
The Commission’s proposal presents a major opportunity to strengthen European AI infrastructure, but differing national commitments, the financing model and competitive pressures will determine whether the EU can close part of the gap with large US AI investors. Project selection is expected in early 2027, with operations and national payments likely starting around 2028.
