How is a Swedish Paper Mill Turning into a Data Centre?

EcoDataCenter has begun construction on its new mega campus in Borlänge, Sweden, as part of a long-term industrial-scale development.

The Kvarnsveden site, previously home to a major paper mill, now forms the base for what the company says will become one of the largest facilities of its kind in Europe.

The first phase of the project, known as EcoDataCenter 2, is scheduled for completion in early 2027.

Once operational, the site will have access to 250 MW of power, with plans in place to scale this to 600 MW over time. This positions the site as a central piece of infrastructure for AI workloads and digital services in the region.

“This is a historic day for EcoDataCenter, for Borlänge, and for Sweden. AI infrastructure is a new base industry, and Kvarnsveden will play a key role in supporting digitalisation,” says Peter Michelson, CEO of EcoDataCenter.

“The facility in Borlänge will become one of the largest projects of its kind in Europe.”

Former mill site becomes AI infrastructure hub

The development follows EcoDataCenter’s acquisition of the former Kvarnsveden paper mill in 2024. Located in central Sweden, the site previously operated as a major producer of newsprint and paper products.

Today, though, it is being repurposed into a large-scale campus designed to support next-generation technology and high-density compute workloads.

“The facility once produced paper – the raw material of the newspaper information age. Now, Borlänge will produce the raw material for AI and the next information age,” adds Peter.

EcoDataCenter confirms that the new campus will be equipped to support the increasing demand for power and processing capacity.

The 600 MW potential puts it in the same bracket as other hyperscale data centres in development across Europe, but its location and reuse of existing infrastructure make it a unique project.

The reuse of the Kvarnsveden mill aligns with regional and national goals around energy use, industrial transformation and technological investment.

By turning an industrial landmark into a technology hub, the project reflects a growing trend of reimagining traditional manufacturing sites for digital infrastructure.

Local support and expanded land acquisition

EcoDataCenter also signs an exclusive agreement to acquire additional land adjacent to the Kvarnsveden site.

This deal ensures room for future expansion as customer demand for compute power continues to grow. The decision to secure more land while breaking ground on the first facility reflects the scale of the company’s long-term ambitions.

Alongside the infrastructure goals, the company has support from Borlänge’s local government. Municipal leaders welcome the transformation of the site and the speed at which the project is moving forward.

“We value what EcoDataCenter brings to our municipality and are pleased that construction can begin so soon after the site acquisition. We look forward to seeing the Kvarnsveden paper mill brought to life in a new form,” says Erik Nises, Chairman of the Municipal Board in Borlänge.

The combination of industrial reuse, large-scale energy availability and local backing positions the Kvarnsveden site as a new focal point for digital infrastructure in Sweden.

EcoDataCenter’s expansion follows growing interest in Nordic data centre capacity, with companies looking for sustainable power sources and stable environments for AI training and cloud services.

As demand for AI infrastructure rises, facilities like EcoDataCenter 2 in Borlänge aim to provide scalable and energy-efficient environments for compute-heavy operations.

With work now underway and further expansion already in planning, the project marks a key step in Sweden’s emergence as a strategic location for digital infrastructure.