Alphabet, Google’s parent company, has agreed to acquire Intersect Power, a data center and clean energy developer, for $4.75 billion in cash plus assumption of the company’s debt. Announced on Monday, the deal enables expansion of power-generation capacity for new data centers by bypassing local utilities strained by AI demand.
The acquisition addresses the challenge of securing reliable energy, which has emerged as essential for training artificial intelligence models that power data centers. Local utilities face difficulties meeting the surging electricity needs driven by AI operations.
Alphabet previously acquired a minority stake in Intersect Power through an $800 million strategic funding round led by Google and TPG Rise Climate in December. This earlier partnership established a goal of reaching $20 billion in total investments by 2030 to support large-scale clean energy and data infrastructure development.
Under the current agreement, Alphabet gains Intersect Power’s future development projects. Existing operations are excluded and will undergo a buyout by other investors, allowing them to operate independently as a separate entity.
Intersect Power’s new data parks consist of sites positioned adjacent to wind, solar, and battery power sources. Google indicated during the announcement of its minority investment that these facilities will become operational in late next year and reach full completion by 2027.
The transaction anticipates closure during the first half of next year. Google plans to serve as the primary user of these data parks. The campuses function as industrial parks capable of accommodating AI chips from other companies alongside Google’s infrastructure.
