Google’s Massive Finland AI Bet is Facing Trouble. Authorities Have Halted Work At Two Data Centers.

Google has been told to halt environmentally significant preparation work at two planned data centers in Finland until required impact assessments have been completed. The decision comes just weeks after the tech giant announced its largest-ever investment in Europe.

Finland's Licensing and Supervision Authority said Google subsidiary Tuike Finland Oy must suspend work at planned data center sites in Muhos and Kajaani immediately and no later than Oct. 23. The environmental impact assessment procedures for both projects are still underway and are expected to be completed during 2026.

The order covers work that could significantly alter the environment, including tree removal, stripping topsoil, excavation, quarrying and crushing, moving soil, ditching and building roads and storage areas.

Planning, measurements, ground surveys and other minor measures that can be easily reversed are not covered by the suspension.

The regulator said extensive preparation had already taken place at the sites while their environmental reviews remained unfinished.

"In our opinion, the measures in question will change the environment and cause impacts, the identification and assessment of which are among the key objectives of the EIA procedure," Tommi Muilu, head of the authority's environmental department, said in the regulator's statement.

The authority had requested information about work at the two sites from Tuike Finland, Muhos municipality, Kajaani city and local building-control authorities on Sept. 18 before issuing the suspension request.

Google said it would comply with the regulator's guidance.

"We understand the concerns and have fallen short of our own high standards in this instance," a Google spokesperson told CNBC, adding that the company had acted in good faith under Finland's Forestry Act and had carried out nature surveys and measures aimed at protecting high-value areas.

The company also said that its landscaping and biodiversity plans include tree planting across 130 hectares at Muhos.

The suspension comes less than a month after Google announced plans to invest at least €13 billion in Finland during 2027 and 2028.

The investment covers data centers and supporting infrastructure in Hamina, Kajaani, Muhos and Vaala, as well as clean-energy projects and local environmental and community programs, according to the company.

Google said the expansion is intended to meet growing demand for services including Search, Maps and Gemini.

The company already operates a data center in Hamina, where it converted a former paper mill into a facility more than 15 years ago. Google began acquiring land in northern Finland for further data center development in 2024.

Its Muhos project remains listed by Google as being in development. The company said earlier that site preparation work had begun there and that the facility was being planned using environmental research and discussions with local authorities.

Google's Finland investment also includes energy agreements intended to support the additional electricity demand from its infrastructure.

The company has signed a 22-year agreement with Finnish energy group Fortum connected to extending the operating life of the Loviisa nuclear plant, alongside plans for new wind generation and battery storage.

Google has said locating new data centers in northern Finland gives the projects access to existing transmission infrastructure near carbon-free electricity generation while reducing the need for additional grid construction.

The two projects affected by the regulator's order are part of that broader expansion.

The Finnish authority said Tuike Finland has been given an opportunity to submit a written response to the suspension request and state whether it intends to comply. If the request is not followed, the authority can consider further enforcement measures.

Environmental impact assessments for the Muhos and Kajaani projects remain in progress, with the assessment reports expected to be completed before the end of 2026.