Key Texas and California assets are excluded from the transaction
Alphabet Inc. announced Monday that it will acquire Intersect, a data centre and energy infrastructure company, for US$4.75 billion in cash plus assumed debt, according to a company statement.
The acquisition aims to expand data centre and power generation capacity as the technology giant faces mounting energy demands from artificial intelligence development. Google, Alphabet’s largest subsidiary, already holds a minority stake in Intersect from a funding round announced in December 2024.
“Intersect will help us expand capacity, operate more nimbly in building new power generation in lockstep with new data centre load, and reimagine energy solutions to drive US innovation and leadership,” Sundar Pichai, CEO of Google and Alphabet, said in the statement.
Powering AI expansion
The deal includes Intersect’s development team and multiple gigawatts of energy and data centre projects either under development or construction, according to the announcement. Intersect operates $15 billion in assets across the United States, with projects representing approximately 10.8 gigawatts of power expected to be online or in development by 2028, Reuters reported. This capacity exceeds 20 times the electricity produced by the Hoover Dam.
Intersect will maintain separate operations from Alphabet and Google under its existing brand, led by founder and CEO Sheldon Kimber. The company will collaborate with Google’s technical infrastructure team on ongoing and future projects, including a co-located data centre and power site under construction in Haskell County, Texas.
“Modern infrastructure is the linchpin of American competitiveness in AI,” Kimber said in the statement. “We share Google’s conviction that energy innovation and community investment are the pillars of what must come next.”
The acquisition excludes Intersect’s existing operating assets in Texas and its operating and in-development assets in California, which will continue as an independent company supported by existing investors TPG Rise Climate, Climate Adaptive Infrastructure, and Greenbelt Capital Partners, according to the announcement.
Technology companies have increased investments in energy infrastructure as US power grids struggle to meet electricity demands from generative AI, Reuters reported. Earlier in December, utility company NextEra Energy expanded its partnership with Google Cloud to build new energy supplies across the US, according to CNBC.
Alphabet said the acquisition supports its commitment to partnering with utilities and energy developers to provide reliable, affordable energy supply for data centre infrastructure without increasing costs for grid customers. The company plans to explore emerging technologies including advanced geothermal systems, long-duration energy storage, and gas with carbon capture and storage.
The transaction remains subject to customary closing conditions and is expected to close in the first half of 2026, according to the announcement.
