Alphabet, Google’s parent company, has just announced the acquisition of Intersect for $4.75 billion in cash, with the assumption of the existing debt. This deal stands as one of Alphabet’s largest-ever transactions and marks a turning point in its strategy to develop data centers dedicated to artificial intelligence.
The stakes are high: enabling Google to access more electricity for its infrastructure, at a moment when the aging U.S. power grid struggles to absorb a surge in demand the likes of which hasn’t been seen in decades. AI is the principal driver behind this rapid growth.
“Intersect will help us scale our capabilities, operate with greater agility in building new power plants aligned with the evolving load from our data centers, and rethink energy solutions to spur innovation and American leadership,” said Sundar Pichai, CEO of Google and Alphabet.
An Impressive Energy Portfolio
Under the terms of the agreement, Alphabet will acquire Intersect’s energy projects and data centers, whether they are in development or under construction. The company owns about $15 billion in assets that are currently in operation or being built.
Intersect currently operates roughly 7.5 gigawatts of solar and storage capacity and plans to develop an additional 8 gigawatts. For reference, one gigawatt is roughly the output of a nuclear reactor and can power around 750,000 homes. The majority of this capacity is concentrated in Texas.
Its CEO, Sheldon Kimber, had even dubbed Texas the “Energy Disneyland” because of its ample wind and solar resources. Among its flagship projects in the state is “Quantum,” a clean-energy storage system built right beside a Google data center campus.
The deal fits into Alphabet’s broader energy strategy. Google, in partnership with TPG Rise Climate, had already supported Intersect in a funding round exceeding $800 million in December 2024.
A Custom-Built Acquisition Structure
As part of this arrangement, Alphabet acquires the development platform and workforce of Intersect, including the development assets already under contract with Google. Intersect will retain its own brand and will continue to be led by Sheldon Kimber.
The company’s existing Texas operating assets, along with its operating and development assets in California, will not be included in the acquisition and will continue to operate as an independent business, supported by its current investors. TPG Rise Climate will retain an ownership stake in these assets.
Intersect will also explore a range of emerging technologies to expand and diversify energy supply, while supporting Google’s investments in its U.S. data centers.
“By acquiring a developer rather than just a power purchase agreement, Google gains the flexibility to build where and when it wants,” said Ben Hertz-Shargel, an analyst at Wood Mackenzie cited by Bloomberg.
