Alphabet acquires Intersect Power in $4.75 billion deal to secure energy for AI expansion

In late 2025, Alphabet, the parent company of Google, made a landmark move by acquiring renewable energy developer Intersect Power for approximately $4.75 billion in cash, including assumed debt. The deal marks a decisive shift in how Big Tech approaches energy, moving away from traditional power purchase agreements toward full vertical integration, where technology companies directly own and control the energy sources powering their artificial intelligence infrastructure.

As AI models scale rapidly, securing reliable and abundant electricity has emerged as a critical competitive necessity. Industry leaders, including Google CEO Sundar Pichai, have publicly identified power availability, not chips or GPUs, as the single biggest constraint on future AI growth. Large-scale AI data centers can consume as much electricity as 100,000 homes, placing unprecedented strain on public utilities and aging grid infrastructure.

One of the central motivations behind the acquisition is bypassing what many now call the “power bottleneck.” While data centers can be constructed in roughly 18 months, grid upgrades often take several years to complete. By owning an energy developer like Intersect Power, Google can bring new generation capacity online in lockstep with data center deployment, eliminating delays caused by external utilities and regulatory timelines.

The deal also strengthens Google’s push toward so-called “power-first” campuses. Major technology companies are increasingly co-locating energy generation and data centers to reduce transmission losses, avoid grid congestion, and improve reliability. A prominent example is Haskell County, Texas, where Google is developing a co-located power and data center facility as part of a broader $40 billion investment in the state.

Through Intersect Power, Alphabet gains control over a projected 10.8 gigawatts of power capacity by 2028 more than 20 times the output of the Hoover Dam. The portfolio is primarily focused on solar generation paired with large-scale battery storage, aligning with Google’s long-standing commitments to renewable energy while meeting the continuous power demands of AI workloads.

Owning its energy supply also allows Google to hedge against electricity price volatility and grid instability. Wholesale power prices can fluctuate sharply, and outages pose a major risk to mission-critical AI training runs that can cost millions of dollars to interrupt. Vertical integration gives Alphabet greater cost certainty and operational resilience as AI becomes central to its core businesses.

Google’s approach contrasts with the strategies adopted by other technology giants. Microsoft is investing heavily in nuclear power, including a high-profile agreement to restart the Three Mile Island plant by 2029. Amazon is pursuing a mix of nuclear options, including investments in small modular reactors and long-term power agreements with existing plants such as Susquehanna. Meta, meanwhile, is relying on a combination of natural gas and renewables to support its “superintelligence” ambitions.

Together, these moves signal a fundamental shift in the AI race. As computing power becomes inseparable from energy infrastructure, success may hinge less on algorithms or hardware and more on who can reliably secure the electrons needed to run them at scale. Alphabet’s acquisition of Intersect Power positions the company at the forefront of this emerging energy-first era of artificial intelligence.