Summary:
Playing catch-up: To shore up its sovereignty in the AI era, the EU wants to triple its data centre capacity in the next five to seven years.
House of CADA: The Cloud and AI Development Act would fast-track data centre permitting – but wouldn’t require community consultation when setting acceleration zones.
So what: Without local buy-in, Europe risks repeating the US experience, where about $130 billion in data centre projects were blocked or delayed in a single quarter this year.
Recommendations: The European Parliament and Council should amend CADA to require early participation (a say, not a veto), a share of the benefits for host towns, and enforceable commitments.
In February 2026, the German town of Gross-Gerau rejected a proposal by Vantage Data Centers to build a €2.5 billion data centre. Environmental and tax concerns played a part in the decision, but local campaigners indicated that had Vantage approached the town earlier, the result might have been different.
Europe hosts around 5% of global AI compute. The Commission’s AI Continent Action Plan admits that Europe’s competitiveness and sovereignty depend on building more capacity at home. A recent proposal by AI policy experts and Nobel laureate economists argues Europe should raise its compute share to 15% by 2030.
Lessons from America
In the US, local opposition blocked or delayed at least 75 data centre projects worth about $130 billion in the first three months of 2026, roughly matching all of 2025. As grassroots opposition groups double in number, so does their political weight: over 530 US local laws sought to ban or restrict data centres as of July.
For America, these losses are a fraction of its data centre pipeline, which is now approaching $2.3 trillion. Europe has seen less opposition so far, but it has also built far less; as it scales up, a similar backlash could seriously set back its ambitions.
America’s data centre rollout has largely treated local communities like an obstacle to manage quietly, with non-disclosure agreements and applications filed as ‘light industrial’ or ‘technology park’. Communities have caught on to the playbook: nearly half of Americans now say data centres are mostly bad for quality of life nearby, up from 30% in January.
However, in some places, Europe has already imported the same playbook. In the Dutch town of Zeewolde, councillors were briefed for two years on a project codenamed ‘Tulip’ before learning it belonged to Meta.
Europe needs towns on board. This doesn’t mean local vetoes over data centres, but rather a say on where and how they’re built.
CADA: built for speed, not buy-in
The Cloud and AI Development Act (CADA), currently before Parliament and Council, aims to triple EU data centre capacity within five to seven years. It would require member states to designate ‘data centre acceleration zones’, where authorities must decide on a permit within 12 months of a developer filing a complete application.
Power and permits are the biggest bottlenecks to Europe’s data centre ambitions, and CADA rightly targets them. But local backlash could become the next.
Two EU laws give the public a say over data centres, but only under conditions. Under the environmental impact assessment directive, residents must be consulted on specific data centre projects before they are approved, but only if national authorities decide an assessment is needed; data centres do not necessarily get one. Under the strategic environmental assessment directive, when a government publishes a draft plan for where development can go, residents can comment on its environmental effects.
With CADA the decision would move from the project to the zone: authorities would assess each acceleration zone once and issue a zone-wide permit (Art. 13(2)–(4)). CADA doesn’t guarantee communities a say when the zones are drawn; residents are not included among the bodies that member states must involve (Art. 10(4)). If residents are consulted on a specific project at all, the zone and its permit are already settled.
CADA’s only mention of the public is incidental: each member state’s permitting office may also hand out information ‘with the aim of increasing public acceptance of the data centre project’ (Art. 12(2)(e)).
Renewable energy projects get a different deal
The 2023 revision of the EU’s Renewable Energy Directive, RED III, requires member states to create ‘renewables acceleration areas’ with a 12-month permitting clock, and consult the public when drawing them.
In December 2025, the Commission proposed to amend the renewables directive again. For renewable projects above ten megawatts, member states would have to ensure a share of the benefits reaches local communities. The Commission’s reasoning is that lack of transparency and insufficient community involvement cause delay and litigation, while early public involvement is ‘a clear success factor’.
Cutting veto points without involvement leaves the reasons to say no intact; they resurface in court and at the ballot box.
Under the Commission’s proposals, residents near an 11-megawatt solar farm would receive a share of its benefits, while those near a €2.5 billion data centre would get nothing.
How to improve CADA
As they negotiate CADA, the European Parliament and Council should reuse three rules the EU has already written for renewables:
Give communities an early say
CADA should use RED III’s language: mandatory participation at the zone-drawing stage for the public affected or likely to be affected.
A 2025 study of US large-scale solar projects found that local communities that reported more engagement in the planning process viewed their projects more positively. The same study reported that most respondents expected the public to offer input on such projects, not make decisions.
Share the benefits with host towns
CADA should give local communities a share of the benefits, as the December 2025 renewables proposal would.
Germany’s cabinet has approved a bill directing 90% of trade tax generated by data centres to the host municipalities, as Germany already does for wind and solar.
A recent study suggests that benefit-sharing works: once German towns shared in wind turbines’ trade tax revenues, the decline in local support for renewables associated with new turbines was at least a third smaller.
Enforce what’s agreed
Without enforcement, towns will be skeptical of promises made by data centre developers. As drafted, CADA requires member states to impose penalties on cloud providers that breach cloud sovereignty rules (Arts. 20–24). It should require similar penalties to ensure developers keep their promises to communities.
Consult early, build fast
Benefits alone are unlikely to be enough. Denmark’s wind compensation schemes left some residents feeling bribed rather than recognised. Participation and benefit-sharing need to go together: one gives towns a voice, the other a stake.
Listening to communities need not add a new stage. CADA already requires member states to involve local authorities when drawing zones (Art. 10(4)), and residents could join that same process.
Increasing its compute share can improve Europe’s options in the AI race. But any meaningful data centre build-out will run through communities. America is learning what happens when it builds around them. Europe should build with them.
