Alibaba is holding preliminary talks with Spanish renewable-energy company Solaria about supplying power to a potential data center in Spain, adding another layer to the Chinese technology group's rapidly expanding European AI infrastructure strategy.
Key Points
- Alibaba has held preliminary discussions with Solaria over renewable power for a potential Spanish data center.
- The Solaria facility under consideration is in Puertollano, about 240 kilometers south of Madrid.
- The discussions remain at an early stage and are less advanced than Alibaba's recently announced European data-center projects.
- Alibaba has also approached other potential energy suppliers.
- The talks come as Alibaba expands its cloud and AI infrastructure across Europe.
- Spain is preparing rules that could require new data-center electricity demand to be matched by additional renewable generation.
Alibaba Looks to Renewable Power in Spain
Alibaba Group Holding is exploring a potential renewable-energy arrangement in Spain as the Chinese technology giant expands its data-center infrastructure to support cloud computing and artificial intelligence.
According to people familiar with the matter cited by Bloomberg, Alibaba has held preliminary discussions with Spanish clean-energy producer Solaria EnergÃa y Medio Ambiente about supplying electricity to a possible data center.
The facility being considered would be connected to Solaria's installation in Puertollano, a city roughly 240 kilometers south of Madrid.
The talks are still preliminary. Alibaba has also been speaking with other potential power providers, meaning the discussions with Solaria do not yet represent a finalized supply agreement.
Why Data Centers Need More Power
The rapid expansion of artificial intelligence is increasing demand for electricity because AI training and inference require large amounts of computing capacity. Data centers therefore need reliable, scalable power supplies, making renewable generation and long-term electricity agreements increasingly important to technology companies.
Alibaba's European AI Expansion
The potential Spanish project is part of a broader European expansion by Alibaba.
The company recently announced plans to establish its first cloud regions in Finland and the Netherlands within the next 12 months. Alibaba is also expanding its data-center footprint in Germany and France.
The strategy places Alibaba in increasingly direct competition with major cloud providers such as Amazon Web Services and Microsoft Azure.
For Alibaba, expanding infrastructure closer to European customers can help provide computing capacity, cloud services and AI products within the region while supporting the company's broader international growth.
A Major AI Investment Push
Alibaba has been investing heavily in artificial intelligence infrastructure. In 2025, the company announced a three-year investment program of about $53 billion focused on AI and cloud infrastructure.
The company's capital spending has also increased sharply as it builds the computing capacity needed for AI services.
That investment makes access to electricity an increasingly important part of Alibaba's expansion strategy. A data center can only operate at scale if sufficient power and grid capacity are available.
Why Spain Is Attracting Data Centers
Spain has become an important European location for data-center development because of its renewable-energy potential, available land and strong international connectivity. Existing investment from companies including Solaria and Merlin Properties has also helped develop the country's digital-infrastructure ecosystem.
Spain Is Preparing New Data-Center Rules
Alibaba's interest comes as Spain prepares a new regulatory framework for the rapidly growing data-center industry.
Under the proposed rules reported by Bloomberg, Spain could require data centers to be operated by companies headquartered within the European Union and require new electricity consumption from data centers to be matched by an equivalent increase in renewable-generation capacity.
The Spanish government is aiming to issue the new rules before the end of 2026.
If adopted, such requirements could become an important factor for companies planning large AI and cloud facilities in Spain.
Solaria Already Has Data-Center Experience
Solaria has been building a business around the connection between renewable energy and digital infrastructure.
In February 2026, the company announced an agreement with Spanish real-estate group Merlin Properties involving 213 megawatts of power access and connection, a 426-megawatt solar power-purchase agreement and battery storage for a data-center project.
The arrangement demonstrates how renewable generation and energy storage can be combined with large digital consumers to provide more predictable electricity supplies for data centers.
The China-Spain Investment Connection
The potential Alibaba project also comes during a period of increasing Chinese investment in Spain. Chinese capital has expanded into areas including electric vehicles, batteries, renewable energy and logistics, while Spain has sought additional foreign investment in strategic industries.
What Happens Next?
The potential Alibaba-Solaria arrangement is not yet a completed deal. The discussions remain preliminary, and Alibaba is considering other energy suppliers as it evaluates its Spanish data-center plans.
The next major factors will include Alibaba's final infrastructure plans, the availability of electricity and grid connections, the terms of any renewable-energy agreement and Spain's forthcoming data-center regulations.
If an agreement is eventually reached, the project would illustrate a broader trend in the AI industry: technology companies are increasingly securing energy supplies alongside computing infrastructure as they build larger data centers.
The Bigger AI Infrastructure Race
The competition to build AI infrastructure is becoming a competition for electricity as well as chips, servers and data-center space.
Alibaba's potential Spanish project shows how closely the growth of cloud computing is becoming linked to renewable-energy development. As AI workloads expand, technology companies will increasingly need large amounts of reliable power while governments face the challenge of balancing digital growth with grid capacity, environmental goals and national regulations.
For Spain, the Alibaba talks add another example of how the country's renewable-energy resources could intersect with Europe's rapidly growing demand for AI computing.
Alibaba's potential partnership with Solaria highlights a central challenge of the AI era: building enough computing infrastructure requires building enough clean, reliable electricity to power it.
