Europe’s data centre sector has struggled to keep pace with rapid growth in the United States and China. While Europe accounted for more than 25% of global data centre capacity in 2015, its share fell to 15% by 2024 as the regional market grew at roughly half the global average. In response, the European Commission unveiled its AI Continent Action Plan in April 2025, setting an objective to triple data centre capacity within five to seven years. The initiative aims to bolster the EU’s position in the global artificial intelligence market while safeguarding economic competitiveness, technological innovation, digital sovereignty and strategic autonomy.
Expanding data centre infrastructure will require close coordination between public authorities and private developers, with particular emphasis on energy systems. Data centres represent a large, concentrated new demand for electricity, and while facility construction typically takes one to two years, strengthening local grids can take much longer. Most existing capacity is concentrated in five major hubs—Frankfurt, London, Amsterdam, Paris and Dublin—often referred to as FLAP-D. Copenhagen and Milan have also become increasingly important. Recently, Dublin and Amsterdam paused new projects because local grids cannot accommodate additional large power loads.
Announcements suggest emerging hubs in Spain and Finland, but most new capacity remains planned for established locations, potentially adding strain to already congested networks. Project sizes are growing as well: in the Netherlands, planned data centre capacities average more than three times the size of current facilities, and in Spain they are seven times larger. If all projects in the pipeline proceed, data centres could represent 4–5% of peak electricity demand in Germany and France, about 10% in Spain and the Netherlands, and an even higher share in smaller markets.
Actual impacts on peak demand and annual consumption will depend on project completion rates, server loading patterns and delays from grid connection queue times, which range from two to ten years in EU countries and seven to ten years in FLAP-D hubs. Grid congestion costs alone reached €4.3 billion in 2024. Policymakers are also concerned about electricity affordability for consumers and potential bottlenecks in critical minerals and equipment supply chains.
To meet its capacity growth target, Europe will need measures such as streamlined permitting, improved grid-connection management, non-firm connections, strategic siting in areas with available capacity, deployment of smart grid technologies and on-site energy storage, and sustained investment in transmission infrastructure. These steps can support rapid data centre expansion while ensuring emissions reductions, network security and consumer affordability.
Source: IEA commentary
