Why Won't Europe Build AI Data Centers in Iceland?

The EU's new Tech Sovereignty Package aims to triple European data center capacity within five to seven years to reduce dependence on US and Chinese cloud providers, but private investment is flowing to France instead of Iceland, which offers ideal conditions with abundant renewable energy and free natural cooling. Despite Iceland being the optimal location for AI data centers on paper, the gap lies not in geology or engineering but in permitting, transmission infrastructure, and political will. Meanwhile, SoftBank's €75 billion commitment to French data centers already dwarfs the entire EU gigafactory program, highlighting Europe's struggle to execute its sovereignty ambitions.