DATA CENTRES

INTELLIGENT TECHNOLOGY

Building upon regional benchmarks established in last year’ s report, the new data reveals a European market that has moved beyond the era of hub-centric development and is evolving into a distributed, energy-integrated and AIdriven digital ecosystem.

Europe’ s data centre sector is entering a period of exceptional expansion, structural diversification and rapid technological transformation driven by AI hyper expansion. However, its ability to fully exploit potential growth is threatened by energy availability and access.

The new report finds European market growth not only within traditional centres such as Frankfurt, London, Amsterdam, Paris and Dublin but also rapidly decentralising across Southern Europe, the Nordics, Central and Eastern Europe and selected Tier 2 metros.

Moving from cloud-led growth to AI demand, data centres are now recognised as critical infrastructure underpinning Europe’ s competitiveness and security.

Europe’ s IT power capacity grew from 10,539 MW in 2023 to 14,784 MW in 2025, exceeding forecasts. Furthermore, € 176 bn in cumulative investment is expected from 2026 to 2031.

Within this growth and investment, scale colocation campuses and AI-optimised facilities dominate new builds. A CAGR exceeding 25 % through to 2031 is expected for scale colocation, reflecting rising demand for high-density cloud and AI clusters.

Traditional retail and wholesale sites continue to expand but their relative share of new capacity is declining as customers increasingly require multi-building, AI-ready environments with long-term scalability.

Hyperscale data centre expansion is accelerating into regions with improving access to renewable energy and favourable operating conditions, as training workloads tend to favour regions with abundant power availability such as the Nordics and parts of Southern Europe.

A notable driver of growth is the rise of neocloud, providers of ultra-highdensity compute with rapid deployment capability and large power tranches aligned with the needs of AI developers, global model providers and emerging cloud-adjacent platforms.

A significant factor affecting the industry is energy availability and access. Power availability is reported as the top challenge for more than two thirds of operators. Grid congestion and long connection timelines in many geographies are slowing deployment.

AI clusters are pushing extreme rack densities beyond 100kW, calling for changes in data centre design, deployment and operation and driving a rapid shift toward liquid and hybrid cooling architectures.

The European data centre industry continues to make a significant contribution to the economy and society. The report finds a € 53bn GDP contribution in 2025 rising to an expected € 137.5bn by 2031 with more than 300,000 direct high skilled jobs supported across the ecosystem.

The industry’ s rapid growth is aligned with climate and regulatory expectations. Ninety per cent of energy consumed by European data centres is generated from renewable energy sources.

“ The exceptional growth of Europe’ s data centre market is welcome news at a time when international volatility has focused many geographies on digital sovereignty and security,” said EUDCA Secretary General Michael Winterson.“ Once the issues of power availability and access are addressed, Europe has the opportunity to lead globally in AI-ready infrastructure while maintaining the highest standards of sustainability and responsible stewardship.” • www. intelligentcio. com

INTELLIGENT CIO EUROPE

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