Google's parent Alphabet on Monday announced that it would purchase clean energy developer Intersect for $4.75 billion in cash, plus existing debt, marking one of its largest deals to expand its data centre capacity.
The deal comes amid a push by Big Tech to invest in energy firms, as power grids in the US struggle to keep pace with the increasing energy demands of generative AI.
“Intersect will help us expand capacity, operate more nimbly in building new power generation in lockstep with new data center load, and reimagine energy solutions to drive US innovation and leadership,” Google and Alphabet CEO Sundar Pichai said, speaking on the deal.
What we know about the deal
Google already owns a minority stake in Intersect from a previous $800 million funding round in December last year.
Under the deal, Alphabet will acquire Intersect's energy and data centre projects that are either currently in development or under construction.
Intersect's other operations, however, will be left intact and separate from Alphabet, with Reuters reporting that the company's existing operating assets in Texas and its operating and under-development assets in California will not be part of the deal.
The clean energy firm will also retain its own brand and will continue to be led by its current CEO, Sheldon Kimbers.
"Intersect’s operations will remain separate from Alphabet and Google under the Intersect brand and will be led by Sheldon Kimber. It will partner closely with Google’s technical infrastructure team, continuing work on in-development, and new, joint projects; this includes the companies’ first announced co-located data center and power site, under construction in Haskell County, Texas," Alphabet said in a statement.
According to its website, Intersect currently has $15 billion worth of infrastructure, either in operation or under construction, with projects representing about 10.8 gigawatts of power expected to be online or in development by 2028.
Commenting on energy infrastructure, Alphabet said its acquisition of certain Intersect assets would help "unlock abundant, reliable, affordable energy supply that enables the buildout of data center infrastructure without passing on costs to grid customers."
Alphabet said that the deal was expected to be closed by the first half of 2026.
