Alphabet’s Quiet Energy Play

The press release was matter-of-fact. Alphabet, parent of Google, would acquire Intersect Power for $4.75 billion in cash, also assuming its debt. The size of the deal alone might raise eyebrows, but what it reveals about the future of AI and infrastructure is far more interesting.

Intersect Power, based in the United States, builds and operates large-scale solar, battery storage, and energy-linked data projects. It’s not a flashy brand and, until recently, wasn’t even part of the conversation around big tech. But that’s changing.

Alphabet’s data centres—already among the world’s most advanced—are now evolving to support AI models that consume even more energy than traditional cloud computing. This deal isn’t about energy for energy’s sake. It’s a response to a growing, global problem: the power grid isn’t keeping pace with AI.

Pressure on the Grid

In the U.S., data centres face delays of up to seven years to get connected to regional power grids. These timelines are no longer compatible with the product cycles of AI development. In a world where generative models are scaled in weeks and months, waiting years for grid connections becomes a serious bottleneck.

Intersect Power has around $15 billion worth of energy and data infrastructure either operating or under construction. By 2028, its renewable energy projects are projected to deliver 10.8 gigawatts of capacity—more than 20 times the output of the Hoover Dam. That figure alone explains why Alphabet acted.

Rather than relying on the strained public grid, Alphabet is moving toward internalised energy solutions. Clean, scalable, and strategically located.

What Alphabet Gets—and What It Doesn’t

The transaction includes all of Intersect’s energy and data centre projects currently in development or construction. Existing revenue-generating assets in Texas and California are excluded and remain with current investors. That decision appears to be strategic—Alphabet is buying for the future, not the past.

Intersect will keep its brand and management team. It will continue to operate independently, suggesting that Alphabet sees value in the company’s operational knowledge and autonomy.

This isn’t a new relationship. In late 2024, Alphabet participated in Intersect’s $800 million-plus funding round alongside TPG Rise Climate. That investment aimed to push forward a model where clean energy plants and data centres operate in parallel—sharing infrastructure, resources, and timelines.

Now, that vision is under Alphabet’s full control.

The Data Behind Your Daily Search

Every time a user fires off a Google search, streams a YouTube video, or prompts an AI chatbot, energy is consumed. The volume of queries has multiplied as AI services proliferate. Behind these interactions are high-performance servers, cooling systems, and backup power—all running 24/7.

Alphabet is not just trying to cut its carbon footprint. It’s ensuring that energy needs do not constrain the pace at which its AI infrastructure can grow. Having direct access to energy—particularly solar and battery-based systems—offers control that traditional utility partnerships simply can’t match.

The Intersect acquisition reflects this new urgency. As the digital economy scales globally, electricity is the unseen commodity shaping its trajectory.

Why Location Matters

A defining feature of Intersect Power’s projects is co-location. Building data centres alongside renewable energy sites isn’t just logistically efficient. It allows near-instant access to power, reduced reliance on long-distance transmission, and lower vulnerability to regional grid issues.

In Texas, Intersect has piloted a clean energy battery storage system right next to a data centre. Though that project isn’t included in the acquisition, it serves as a working example of the model Alphabet is now buying into.

These energy campuses could become the template for future AI hubs—not just in the U.S., but wherever demand justifies deployment.

What the Deal Signals

Alphabet is one of the few companies in the world with the capital, urgency, and infrastructure to justify acquiring a clean energy company at this scale.

There’s a precedent for this kind of move. Microsoft, Amazon, and Meta have all made major clean energy deals, mostly in the form of long-term purchase agreements. But Alphabet’s full acquisition of an energy developer is a different approach. It suggests vertical integration—where the supply chain of power, data, and AI all sit under one roof.

That model brings new responsibilities but also greater agility. It could also set a new benchmark for how tech firms approach energy: not as an operational cost, but as a strategic investment.

Who Holds the Switch?

Electricity is no longer someone else’s problem. It’s core to AI infrastructure, and Alphabet’s move acknowledges this directly. By 2028, the company will have a significant stake in its own energy production pipeline.

The deal doesn’t fix every problem. Regional politics, regulatory hurdles, and land acquisition remain complex. But it gives Alphabet more tools to navigate them—and more control over how fast it can scale its AI systems.

For users, these changes remain invisible. Yet they’re shaping the reliability, speed, and scope of every online service Google offers.