Alphabet to acquire Intersect Power to expand energy capacity for AI data centers

TechCrunch
TechCrunch
1h ago
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Alphabet is acquiring Intersect Power for $4.75 billion to secure renewable energy capacity for AI data centers and circumvent grid bottlenecks.
Alphabet to acquire Intersect Power to expand energy capacity for AI data centers
A What happened
Alphabet is purchasing Intersect Power for $4.75 billion in cash plus debt assumption to increase its own power generation capacity alongside new AI data centers. This acquisition helps Alphabet avoid bottlenecks in local energy grids that struggle to meet AI demand. Intersect, in which Alphabet previously held a minority stake, develops clean energy data parks near wind, solar, and battery storage. These projects will begin operations by late 2026 and fully finish by 2027. Intersect’s current operations are excluded from the deal, being sold to other investors and run independently. Google will be the primary user of the new campuses, which also accommodate other companies’ AI computing hardware.

Key insights

  • 1

    Strategic control of energy supply for AI infrastructure: Alphabet’s acquisition reflects a trend among tech giants to secure dedicated, renewable energy assets to reduce dependency on public utilities and enhance data center scalability.

  • 2

    Addressing grid bottlenecks amid surging AI demand: As AI model training expands rapidly, traditional local grids face capacity challenges, prompting vertically integrated energy investments by companies operating large-scale AI infrastructure.

  • 3

    Emergence of specialized industrial parks combining renewables and AI computing: Intersect’s data parks exemplify a new infrastructure model that colocates AI hardware near renewable energy to optimize efficiency and sustainability for data-intensive operations.

Takeaways

Alphabet's Intersect Power acquisition marks a pivotal move towards vertical integration of energy and AI infrastructure, aiming to secure capacity and sustainability amid growing AI workloads.

Topics

Technology & Innovation Artificial Intelligence World & Politics Policy & Regulation Climate & Environment Energy Business & Markets Strategy

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