Google just spent $4.75B chasing power for AI data centers

Alphabet is buying energy and data center developer Intersect for $4.75 billion in cash, plus the assumption of debt – a clear signal that securing power, not just servers, has become one of Google’s biggest bottlenecks as AI demand explodes.

Google just bought an energy developer

Google already owns a minority stake in Intersect from a previous funding round. Once the deal closes, Intersect will be expected to help bring new data centers and power generation online faster, supporting Google’s rapidly growing cloud and AI workloads.

Intersect was founded in 2016 and was initially based in Beaverton, Oregon, before moving its headquarters to San Francisco this year. The company boasts a substantial pipeline of projects, encompassing multiple gigawatts of energy and data center capacity, either under construction or in development, through its existing partnership with Google. It says it will continue to explore emerging energy technologies to expand and diversify its power supply, while supporting Google’s US data center buildout.

Intersect won’t be folded directly into Google or Alphabet. It will continue to operate under the Intersect brand and will be led by founder and CEO Sheldon Kimber. The company will work closely with Google’s technical infrastructure team on current and future projects, including the companies’ first announced co-located data center and power site now under construction in Haskell County, Texas.

Not all of Intersect’s assets are included in the acquisition. Its operating assets in Texas, along with operating and in-development assets in California, are being carved out and will remain part of a separate, independent company.

Google CEO Sundar Pichai said 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.” The “solutions” it cites in its announcement include “advanced geothermal, long-duration energy storage, and gas with carbon capture and storage.” 

Kimber said joining Google will allow Intersect to accelerate its work at scale as energy becomes a limiting factor for AI-driven growth. In a blog post, he wrote that “America deserves a better business model for electricity. That model is increasingly ​’bring your own generation’ … In the case of Intersect, that has meant renewables paired with flexible backup sources and energy storage, often on the same site as the data centers themselves.”

Beyond the acquisition itself, Alphabet says the deal fits into a broader effort to unlock more abundant, reliable, and affordable energy for data centers without shifting costs onto everyday grid customers. The company also says it’s using AI to help speed up grid connections for new power plants and expand energy efficiency and affordability programs in communities hosting data centers.

The transaction is expected to close in the first half of 2026.

Electrek’s Take

This deal underlines a growing reality that Big Tech can’t wish away: AI is running headfirst into hard physical limits on the grid. Buying Intersect may help Google move faster on paper, but it doesn’t magically create transmission lines, community buy-in, or surplus clean power overnight.

Google emphasizes not passing costs onto grid customers, and that should indeed be a priority, but data centers are already reshaping power markets across the US. As Big Tech moves upstream into energy development, the real test will be whether these projects actually ease grid stress and accelerate clean generation, or simply give hyperscalers a fast lane while everyone else waits in the interconnection queue.

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