Germany targets AI data hub expansion by 2030

Germany plans to encourage investment in data centres to raise domestic capacity to roughly 4,800 MW by 2030 and industry groups say artificial intelligence data processing demand would need to roughly quadruple by 2030, according to documents cited by Reuters. The strategy is part of an effort to strengthen AI data processing and narrow the gap with dominant players such as the United States and China.

The initiative, reported by Reuters and outlined by the German government, focuses on expanding local infrastructure for AI workloads. AI data centres in Germany had a total capacity of 530 megawatts at the end of last year, much of it operated by non-German providers, according to industry figures from German lobby group Bitkom.

Digital minister Karsten Wildberger has proposed a range of measures designed to support the expansion, including dedicating land for development of new facilities. These measures are scheduled to be approved by ministers on Wednesday, according to the government documents.

Under the scheme, municipal business taxes will flow to the town or city that hosts a new data centre rather than to the municipality where the company operating it is headquartered. The government also intends to accelerate regulatory reviews and encourage collaboration among companies across the AI supply chain.

A document from the digital ministry states that Germany welcomes investment from third countries. However, the strategy primarily targets European and German companies as preferred investors in the planned capacity expansion.

Major global technology firms including Amazon (AMZN), Microsoft (MSFT) and Google (GOOGL) are among the largest spenders on German data infrastructure, according to the government documents. These companies already operate significant capacity in the country and could be affected by or participate in the new expansion push.

Domestic players in the German market include Deutsche Telekom (DTEd) and the unlisted Schwarz Group. The existing mix of foreign and local operators means that a substantial share of current capacity is run by non-German providers, which provides context for the government’s aim to increase European involvement.

The German initiative comes as European countries seek greater sovereign control over AI infrastructure. This trend is driven by factors such as rising tariffs, armed conflicts and diverging regulations on online content, according to the Reuters reporting on the government documents.

By linking fiscal incentives, land allocation and streamlined permitting to AI infrastructure build-out, the German government aims to position the country as a stronger base for AI data processing within Europe. The planned doubling of capacity and fourfold increase in AI processing by 2030 form the quantitative core of this policy agenda.