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Alphabet agreed to acquired data centre energy group Intersect Power for close to $5bn, boosting the Google parent’s power generation as it races to develop cutting-edge artificial intelligence.
The deal, announced on Monday, would enable Alphabet to bolster its data centre capacity, said Sundar Pichai, the group’s chief executive.
“Intersect will help us expand capacity, operate more nimbly in building new power generation in lockstep with new data centre load, and reimagine energy solutions to drive US innovation and leadership.”
Intersect, which is backed by private equity group TPG, develops infrastructure, including renewable power sources, for data centre campuses.
The deal to buy Intersect for $4.75bn in cash, plus debt, broadens Alphabet’s access to power at a time when the technology giant is competing with rivals including OpenAI, Elon Musk’s xAI and Meta to train and run energy-intensive AI models.
Each of those companies has sought ways of expanding their access to power, either via the grid or by generating power on-site.
Alphabet said the deal would augment its “ongoing commitment to partnering with utilities and energy developers across the sector to unlock abundant, reliable, affordable energy supply that enables the build-out of data centre infrastructure”.
The Big Tech company took a minority stake in Intersect last year, partnering with the group to develop energy plants for data centres. Those assets, as well as Intersect’s staff, are included in the transaction.
Intersect has $15bn of assets operating in the US or under construction, according to the company. Those assets, in Texas and California, were not included in the deal and would remain under the Intersect brand, the companies said.
