Alphabet (GOOGL) Stock: Company Buys Clean Energy Developer Intersect for $4.75 Billion to Power AI Expansion

TLDR

• Alphabet is buying clean energy developer Intersect for $4.75 billion in cash plus assumed debt to secure power and infrastructure for AI growth
• Intersect builds data parks that combine data centers with clean energy sources including solar, wind, and battery storage
• The deal includes several gigawatts of energy and data center projects currently in development or under construction
• Intersect will remain a separate brand under founder Sheldon Kimber but work closely with Google’s infrastructure team
• Some existing Intersect assets in Texas and California serving other clients will be spun off as an independent company

Alphabet announced Monday it will acquire Intersect, a private developer of data centers and clean energy sites, for $4.75 billion in cash. The deal also includes Intersect’s existing debt.

The transaction addresses a growing problem for tech companies racing to build AI systems. Power supply and infrastructure have become major obstacles to expansion. Intersect specializes in building what it calls “data parks” that place renewable energy sources directly next to new data centers.

Alphabet Inc., GOOGL

This setup helps tech firms avoid delays caused by strained power grids. It also gives them more control over their energy supply as AI computing demands surge.

The two companies already had a relationship before this deal. Google and investment firm TPG Rise Climate backed Intersect with more than $800 million in funding last December. Alphabet also held a minority stake in the company.

Infrastructure Built for Speed

Intersect’s portfolio includes solar farms, wind installations, and battery storage systems. By 2028, the company expects to have projects representing about 10.8 gigawatts of power either online or in development. That’s more than 20 times the electricity output of the Hoover Dam.

The acquisition gives Alphabet access to projects already underway. This means faster deployment of new computing capacity compared to building from scratch. Power, land availability, and construction speed have all become bottlenecks for major tech companies expanding their AI operations.

One of Intersect’s Texas projects is Quantum, a clean energy storage system being built right next to a Google data center campus. This type of co-location is central to Intersect’s model and what makes the company valuable to Alphabet.

Not all of Intersect’s assets are included in the purchase. The company’s existing operating facilities in Texas and its current and planned projects in California will be carved out. These assets will continue as an independent business backed by Intersect’s current investors.

Deal Structure and Timeline

The transaction is expected to close in the first half of 2026. Intersect will keep operating as a separate brand under its founder and CEO Sheldon Kimber. However, the company will work closely with Google’s infrastructure teams.

Alphabet CEO Sundar Pichai said the deal will help the company scale its operations more efficiently. He also noted the acquisition supports U.S. objectives in both energy development and technology leadership.

Google Cloud recently expanded a separate partnership with utility company NextEra earlier this month. That agreement focuses on building new energy supplies for Google’s operations across the United States.

Intersect has about $15 billion worth of assets either currently operating or under construction. The company plans to explore new technologies to increase and diversify its energy supply as part of Alphabet’s infrastructure strategy.

Alphabet shares closed at $309.78 on Monday, up slightly for the day. Analysts maintain a Strong Buy rating on the stock with an average price target of $326.41.

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