Dutch government invests €200M to launch AI factory in Groningen’s former tobacco plant: Know more

The Dutch government, in partnership with the Groningen/Noord-Drenthe region and European partners, has announced a €200M investment to establish a national AI Factory in Groningen.

The initiative is part of a strategic effort to secure the Netherlands’ digital independence and strengthen its position as a European leader in artificial intelligence innovation.

The AI Factory will serve as an innovation hub where researchers, entrepreneurs, and government organisations will collaborate to develop advanced AI technologies.

Equipped with a supercomputer offering enormous computational power, the facility will enable secure data storage and processing to support next-generation applications across sectors, including smart agriculture, healthcare, energy networks, security, defence, and manufacturing.

Minister Karremans (Economic Affairs) says, “AI is going to fundamentally change our economy and society. But anyone who does not develop the technology themselves is dependent on others. That is why we are fully committed to a strong Dutch AI infrastructure. This is not a luxury, but an absolute necessity to maintain our digital independence and competitiveness.”

The government is contributing €70M, and the regional administrators are contributing another €60M from the Economic Agenda of ‘Nij Begun’.

The government has also submitted a European co-financing application of €70M together with a consortium of SURF, AIC4NL, TNO, and Samenwerking Noord.

This could bring the total investment to €200M.

Groningen as preferred location

Groningen was selected as the preferred location due to its strong network of universities, technical institutes, and innovative companies, as well as its available grid capacity, a critical advantage in light of widespread congestion in other regions.

The preferred site is a former Niemeyer tobacco factory in the city, repurposed to house cutting-edge technology and research facilities.

The AI Factory is expected to be operational by 2026, with the supercomputer reaching full capacity by early 2027.

Once live, the facility will serve as a cornerstone for experimentation, collaboration, and the commercialisation of AI solutions that will help businesses stay competitive in a rapidly evolving landscape.

In parallel to Groningen’s bid, the province of South Holland has submitted its proposal to host an AI gigafactory. The initiative is spearheaded by entrepreneur Han de Groot in collaboration with Eneco and a broad consortium of Dutch knowledge institutions and companies, reports ioplus.nl.