Europe’s AI Story: Speed, Strategy, and Green Power Define the Race

Europe is not trailing in the artificial intelligence (AI) race as much as it might appear, despite lagging in the development of large language models (LLMs) compared to the U.S. and China. According to recent assessments, European companies are on par with their U.S. counterparts when it comes to AI adoption, with success hinging more on the speed of implementation than initial conditions. Matthias Tauber, head of Boston Consulting Group’s operations in Europe, Middle East, South America, and Africa, emphasizes that “whether they will be winners, yes or no, will be determined by who drives adoption faster” [1]. Similarly, Dominic King, EMEA research lead at Accenture, points out that European firms are well positioned to build applications on top of U.S.-developed models, reinforcing the continent’s potential to leverage AI effectively [1].

Despite Europe’s underdevelopment in foundational AI models, it has several key players demonstrating strong AI integration. Accenture, for example, has committed $3 billion to AI integration and reported $4.1 billion in revenue from GenAI work in Q3 2023 [1]. The company is actively building an AI workforce of 80,000 by 2026, a clear indicator of its long-term strategic focus on AI. Schneider Electric is another standout, having generated over €100 million in business value from AI-driven cost savings and operational efficiencies, including a “self-healing” supply chain platform and an internal generative AI tool known as Jo-ChatGPT [1].

The European Commission is also playing a pivotal role in bolstering AI infrastructure and innovation. In June 2024, it launched the EU AI Office, now a team of over 100 experts working across six units, including AI safety, regulation, and innovation. The AI Office is central to implementing the AI Act, particularly for general-purpose AI, and is helping position Europe as a leader in responsible AI development [2]. Under the AI Continent Action Plan, the Commission has outlined five key domains for action, including the establishment of 13 AI Factories and up to five AI Gigafactories to support the continent’s computing infrastructure [2]. This initiative is complemented by InvestAI, a €20 billion funding instrument aimed at stimulating private investment in AI infrastructure [2].

Infrastructure challenges, particularly in energy and data centers, remain a significant barrier to AI adoption in Europe. Data center vacancy rates are at historic lows, and the continent’s energy grid is under pressure from AI’s increasing electricity consumption. Goldman Sachs predicts that data centers could add 40–50% to Europe’s power demand over the next decade, which could strain the grid and raise costs for businesses [1]. Energy volatility poses a dual challenge for data center operators, who must manage both fluctuating demand and supply constraints. Zendo’s CEO, Jade Batstone, highlights the uncertainty this creates, emphasizing the need for resilient infrastructure that can accommodate AI’s growing energy needs [1].

However, Europe’s strengths in clean technology and renewable energy could offer a counterbalance to these challenges. With renewables accounting for 50% of EU electricity generation in 2023, the continent is well positioned to support green data centers [1]. The European Data Centre Association projects €100 billion in data center investments in the EU by 2030, with an emphasis on sustainable infrastructure [1]. Companies like Google and BNP Paribas have committed to fully renewable-powered data centers, and the EU’s Clean Industrial Deal aims to establish a competitive niche in green technology, including data centers [1]. While full decarbonization is not yet achievable, Europe’s regulatory focus on energy and data efficiency is helping shape a framework for sustainable AI deployment [1].

In the private sector, momentum is growing. Mistral AI, a Paris-based startup, is preparing to raise €2 billion at a $14 billion valuation, reflecting strong investor confidence in European AI innovation [3]. The funding, if confirmed, would mark one of the largest investments in a European AI company and could catalyze broader adoption across the continent. Mistral’s strategic focus on infrastructure and sovereignty—building a data center in France equipped with 18,000 NVIDIA GPUs—illustrates the growing ambition of European AI firms to compete on a global scale [3]. The success of this funding round could serve as a bellwether for whether Europe can produce AI champions capable of challenging U.S. dominance in the sector [3].

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[1] There's more to life than LLMs, or why Europe needn’t fall behind in AI adoption (https://fortune.com/2025/09/09/theres-more-to-life-than-llms-or-why-europe-neednt-fall-behind-in-ai-adoption-mistral-accenture-bcg/)

[2] The European AI Office: Driving innovation with open and trusted data (https://data.europa.eu/en/news-events/news/european-ai-office-driving-innovation-open-and-trusted-data)

[3] Mistral AI Nears €2 Billion Raise, Driving Europe's Bid for AI Independence (https://www.fintechweekly.com/magazine/articles/mistral-ai-2b-funding-european-ai-independence)