US technology company Oracle is investing $1 billion (€860 million) to expand its cloud and AI infrastructure in the Netherlands, the company confirmed on Tuesday. The funding will be used over the next five years to significantly boost capacity at its Amsterdam data centre.

The investment is intended to meet what Oracle described as “rapidly growing demand” for cloud and AI services from Dutch businesses. The company said it may add further facilities depending on future demand, though it declined to comment on the impact of electricity grid congestion or whether the expansion would create new jobs.

“This investment underscores our commitment to supporting Dutch companies as they embrace AI and new technologies at a rapid pace,” said Wilfred Scholman, head of Oracle Netherlands, in a statement.

Oracle’s Amsterdam location, established five years ago, is part of a network of over 50 interconnected “cloud regions” designed to comply with local regulatory frameworks. The Amsterdam region will now see a major upgrade to its AI infrastructure, following similar recent investments by Oracle in Germany, Spain and the UK.

In March, the Dutch government said it was exploring a sovereign cloud option for public sector use, following mounting worries at home and in the EU about the use of US cloud services.

Oracle said it offers European customers a cloud environment that meets EU standards, and stressed that data is protected from US surveillance demands. Other US providers have also made similar claims about so-called “sovereign cloud” services.

The announcement comes shortly after the Dutch government unveiled plans to invest €70 million in a new “AI factory” in Groningen to develop applications in healthcare, defence and energy.