Alphabet Acquires Intersect Power for $4.75B to Safeguard Energy for AI Data Centers

Alphabet’s acquisition of Intersect Power represents a strategic bid to internalize control over a critical supply chain component—energy supply—amid booming demand for AI infrastructure. By purchasing a company that co-locates power generation (renewable, gas, storage) with data centre campuses, Alphabet aims to sidestep delays and dependencies arising from existing utility-grid constraints. This increases its ability to build capacity “in lockstep” with load requirements.

The structure of the deal indicates a selective approach: assets that are already operating or in development in Texas and California and contracted for non-Google users are excluded, continuing under existing investors. This suggests Alphabet is targeting projects where it can both derive maximum benefit and exert close operational control, while balancing regulatory, investment, or contractual constraints elsewhere.

Financially, while $4.75 billion plus assumed debt is significant, the overall opportunity comes via acquiring control over gigawatts of generation capacity and project pipeline, rather than just acquiring physical assets. With Intersect’s pipeline expected to bring ~10.8 gigawatts online by 2028—over 20× the power output of Hoover Dam—and $15 billion of assets under operation or construction, the multiple will depend heavily on Alphabet’s ability to integrate and deploy rapidly.

Strategically, this move strengthens Alphabet’s positioning in the AI arms race vs competitors like Meta, Microsoft, Amazon, and xAI by bolstering its energy supply chain. It also demonstrates Alphabet’s growing role not just as a consumer of infrastructure, but as a builder and owner of energy generation capacity, including emerging technologies like long-duration storage, carbon capture, and potentially advanced geothermal.

Open questions remain: what regulatory hurdles will the deal face in jurisdictions with tight permitting for power plants or interconnects; whether the excluded assets pose opportunity risk; how Alphabet plans to ensure the cost of energy remains low for both its own load and for local grid customers; and how this may influence its capital expenditures in 2026—especially given already increased guidance in infrastructure spend noted in recent reports.