The European Commission and European Investment Bank Group hold up the process that will release funding for AI factories as hyperscalers pour in tens of billions
If the European Commission (EC) classes its approach to setting up and allocating funding for AI factories as urgent, what would no hurry would look like? The EC has a €20 billion burning a hole in its pocket to fund up to five AI gigafactories as part of its InvestAI initiative, in the interests of European sovereignty.
At the end of last week, the EC and European Investment Bank Group (EIB) finally signed an MoU to support the building of data centres for the development and running of AI models. However the process that enables enterprises to apply for that funding has been kicked into 2026.
The EC said, “Beyond unlocking investment, this partnership aims to translate Europe’s AI vision into concrete, large‑scale facilities that can power innovation, strengthen technological sovereignty, and position the EU as a global leader in artificial intelligence.
The EIB Group is to provide “tailored advisory support to consortia that responded to the commission’s informal Call for Expression of Interest,” it went on, adding, “this guidance will help turn ambitious concepts into bankable projects that can be submitted in the formal call for the establishment of AI gigafactories planned for early 2026, paving the way for potential EIB co-financing.”
Meanwhile, on one day alone in November, Microsoft and Google between them committed more than €14 billion for data centres in Portugal and Germany.
Europe’s larger operating groups are expected to apply.
Better use of public funds?
Dr Anda Bologa, a senior researcher in the Tech Policy Program at the Center for European Policy Analysis (CEPA) thinks funding AI factories might not be the best use of European public money.
She notes, as have we, that Europe’s AI factory initiative pales in comparison with the amounts being poured into AI infrastructure by China and the US. Europe is stumping up €20 billion; OpenAI has pledged half a trillion dollars over the next four years for its Stargate project.
Dr Bologa suggests in her CEPA blog that Europe “might do better by focusing on increasing demand for AI products. Only 13% of European companies say AI is core to their business, versus 49% in the US and 83% in China. If more Europeans used AI, then European companies could spring up naturally to satisfy it.
‘The European Commission launched an AI Apply Strategy this month ‘to speed up the use of AI in key industries and the public sector.’ It plans to provide a budget of €3.5 billion a year. That may be more successful than pouring more than five times the funds into AI gigafactories.”
