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Nvidia's ( NVDA ) AI projects highlight Europe's lack of AI

infrastructure

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EU leaders emphasize AI infrastructure for digital

sovereignty

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High electricity costs challenge Europe's AI data center

expansion

By Supantha Mukherjee

PARIS, June 16 (Reuters) - Nvidia ( NVDA ) CEO Jensen

Huang has been pitching the idea of "sovereign AI" since 2023.

Europe is now starting to listen and act.

The concept is based on the idea that the language,

knowledge, history and culture of each region are different, and

every nation needs to develop and own its AI.

Last week, the CEO of the artificial-intelligence chipmaker

toured Europe's major capitals - London, Paris and Berlin -

announcing a slew of projects and partnerships, while

highlighting the lack of AI infrastructure in the region.

In a place where leaders are increasingly wary of the

continent's dependency on a handful of U.S. tech companies and

after drawing ire from the U.S. President Donald Trump, his

vision has started to gain traction.

"We are going to invest billions in here ... but Europe

needs to move into AI quickly," Huang said on Wednesday in

Paris.

On Monday of last week, British Prime Minister Keir Starmer

announced 1 billion pounds ($1.35 billion) in funding to scale

up computing power in a global race "to be an AI maker and not

an AI taker."

French President Emmanuel Macron called building AI

infrastructure "our fight for sovereignty" at VivaTech, one of

the largest global tech conferences.

After Nvidia ( NVDA ) laid out plans to build an AI cloud platform in

Germany with Deutsche Telekom, German Chancellor

Friedrich Merz called it an "important step" for the digital

sovereignty and economic future of Europe's top economy.

Europe lags behind both the U.S. and China as its cloud

infrastructure is mostly run by Microsoft ( MSFT ), Amazon ( AMZN )

and Alphabet's Google, and it has only a few

smaller AI companies such as Mistral to rival the U.S. ones.

"There's no reason why Europe shouldn't have tech

champions," said 31-year-old Mistral CEO Arthur Mensch, sitting

beside Huang, who has led Nvidia ( NVDA ) for more than three decades, at

a panel at VivaTech.

"This is a gigantic dream."

GIGAFACTORY PLANS UNLEASHED

In France, Mistral has partnered with Nvidia ( NVDA ) to build a data

centre to power the AI needs of European companies with a

homegrown alternative.

It will use 18,000 of the latest Nvidia AI chips in the

first phase, with plans to expand across multiple sites in

2026.

In February, the European Union announced plans to build four

"AI gigafactories" at a cost of $20 billion to lower dependence

on U.S. firms.

The European Commission has been in touch with Huang and he

had told the EU executive that he was going to allocate some

chip production to Europe for these factories, an EU official

told Reuters.

Nvidia's ( NVDA ) chips known as Graphics Processing Units or GPUs

are crucial for building AI data centres from the U.S. to Japan

and India to the Middle East.

In Europe, a push for sovereign AI could reshape the tech

landscape with domestic cloud providers, AI startups, and

chipmakers standing to gain from new government funding and a

shift toward in-region data infrastructure.

Nvidia ( NVDA ) also wants to cement demand for its AI chips,

ensuring that even as countries seek independence, they still

rely on its technology to get there.

POWER COSTS

The push is not without challenges.

High electricity costs and rising demand could strain sourcing

of electricity for data centres. Data centres account for 3% of

EU electricity demand, but their consumption is expected to

increase rapidly this decade due to AI.

Mistral, which has raised just over $1 billion, is trying to

become a European homegrown champion with a fraction of the

money U.S. hyperscalers or large data-centre operators spend in

a month.

"Hyperscalers are spending $10 billion to $15 billion per

quarter in their infrastructure. Who in Europe can afford that

exactly?" said Pascal Brier, chief innovation officer at

Capgemini, a partner of both Nvidia ( NVDA ) and Mistral.

"It doesn't mean we shouldn't do anything, but we have to be

cognizant about the fact that there will always be a gap."

Mistral has launched several AI models which are used by

businesses but companies tend to mix them with models from other

companies such as OpenAI, Anthropic and Meta Platforms ( META ).

"Most of the time it's not Mistral or the rest, it's Mistral

and the rest," Brier said.

($1 = 0.7393 pound)