Energy transmission firm Global Interconnection Group (GIG) is planning a data center campus in Iceland.

The EuroNext-listed company this week announced that its recently formed joint venture, GIGA-42 Holdings Limited, has signed a Memorandum of Understanding (MoU) with Norðurþing Municipality, Iceland, to collaborate on the development of a large-scale, AI-optimized data center at Bakki, Húsavík.

The company said the phased modular campus would initially target 50MW, making it one of the largest sites in the country. The campus would be in close proximity to Landsnet’s 220kV transmission line and the Bakki electricity substation, as well as fiber connectivity.

Norðurþing is located on the northern side of Iceland. Data Center Map currently lists no facilities in the area.

The MoU establishes a non-binding framework for cooperation on site allocation, zoning, infrastructure development, and permitting of the project. A target final investment decision is expected next year, with first-phase operations expected in 2027.

GIG has traditionally been focused on interconnector power cables and transmission infrastructure. GIG’s wholly owned subsidiary, ASC Energy, is developing Atlantic SuperConnection, a 1,794MW, 1,708 km (1,061 miles) interconnector between Iceland and the UK.

Earlier this month, GIG acquired a 20 percent stake in GIGA Holdings, which has partnered with Northern DC AS (trading as Scale42) to establish GIGA-42 Ltd., a joint venture focused on developing AI data centers in the Nordics. The companies first announced plans to form a joint venture in April.

The partnership was set to advance a pipeline of projects across Iceland, Norway, Sweden, and Finland. GIG said it would be using its expertise in undersea data and power cables, energy transmission, and interconnection to secure suitable sites with reliable renewable power and grid access.

“GIGA-42 will deliver AI-optimized data centers, co-located with reliable renewable energy generation and high-voltage grid connections, integrated with industrial redevelopment,” GIG said.

Scale42, led by the founders of Fjord Power and Hydrokraft (now AI cloud firm Nscale), recently partnered with private equity firm APL for a 60MW data center project in Varkaus, Eastern Finland.

GIG said Scale-42 has a development pipeline exceeding 1GW across the Nordics, though the company hasn’t detailed plans.