^{Photo: Bloomberg.com}

Alphabet has announced plans to acquire Intersect, a data center and energy infrastructure company, in a deal valued at $4.75 billion in cash along with the assumption of debt. The move underscores Google’s intensifying focus on securing power and computing capacity as demand for artificial intelligence continues to surge.

A Strategic Infrastructure Bet

Alphabet said Intersect will continue to operate independently after the acquisition, but its assets and expertise will play a key role in helping Google bring new data center capacity and power generation online more quickly. The deal is designed to shorten development timelines and reduce bottlenecks tied to energy availability, one of the biggest constraints facing large scale AI infrastructure.

Google had already been a minority investor in Intersect following a funding round announced late last year, giving Alphabet a close look at the company’s capabilities before moving to a full acquisition.

Racing to Keep Up in the AI Arms Race

The acquisition comes as competition among major technology companies intensifies. Since the launch of ChatGPT in 2022, AI driven demand for computing power has exploded, pushing cloud providers and AI developers into an unprecedented infrastructure buildout.

OpenAI alone has announced infrastructure commitments exceeding $1.4 trillion to support the data centers and energy systems required to scale its models. Alphabet’s move signals that Google intends to remain competitive by controlling more of the physical backbone behind its AI ambitions.

Google and Alphabet CEO Sundar Pichai said Intersect will help the company expand capacity faster, build power generation in parallel with new data center loads, and rethink energy solutions that support long term U.S. innovation and leadership.

Renewable Energy and Gigawatt Scale Plans

Intersect has positioned itself as a developer of large scale, energy integrated data center projects. In its earlier partnership announcement with Google and TPG Rise Climate, the company outlined plans to develop multiple gigawatts of data center capacity across the United States.

That strategy included a commitment of up to $20 billion in renewable energy investments by the end of the decade, aligning with Google’s broader goal of operating on carbon free energy around the clock.

Texas at the Center of Expansion

Alphabet said Intersect will work closely with Google’s technical infrastructure teams, including collaboration on a co located power generation and data center site in Haskell County, Texas. The state has become a major hub for U.S. data center development due to its energy availability, supportive regulations, and scalable land options.

Google previously announced a $40 billion investment plan in Texas through 2027, which includes the development of new data center campuses in Haskell and Armstrong counties. Intersect’s involvement is expected to help streamline energy sourcing for these large scale projects.

Assets Excluded From the Deal

Not all of Intersect’s operations are included in the acquisition. Alphabet said Intersect’s operating and in development assets in California, as well as certain operating assets in Texas, are excluded from the transaction.

Those assets will continue to be owned and supported by Intersect’s existing investors, including TPG Rise Climate, Climate Adaptive Infrastructure, and Greenbelt Capital Partners, and will operate as a separate independent company.

Timeline and Market Implications

The transaction is expected to close in the first half of 2026, subject to customary regulatory approvals and closing conditions.

For Alphabet, the deal reflects a growing recognition that control over power generation and physical infrastructure is becoming as critical as software in the AI era. As data centers grow larger and more energy intensive, companies that can secure reliable, scalable, and cleaner power sources may gain a lasting competitive edge.

For the broader tech industry, Alphabet’s move highlights a structural shift where big technology firms increasingly invest directly in energy and infrastructure, blurring the line between digital platforms and industrial scale utilities.