In a move that signals just how fiercely the race for artificial intelligence (AI) infrastructure is heating up, Alphabet Inc.—the parent company of Google—has announced a landmark agreement to acquire Intersect Power, a prominent California-based developer of utility-scale solar and battery energy storage systems. The deal, valued at $4.75 billion in cash and the assumption of debt, marks the first time a major technology company has directly acquired a leading renewable energy developer, rather than simply purchasing power through long-term agreements. The acquisition is expected to close in the first half of 2026, pending customary conditions, according to pv magazine USA.
Why is Google making such a bold bet on energy? The answer lies in the surging demand for AI services from businesses and consumers, which is driving an unprecedented need for data center capacity—and, by extension, energy. As Sundar Pichai, CEO of Google and Alphabet, put it in a statement reported by Jonathan Spencer Jones, "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."
The acquisition brings Intersect’s team and a pipeline of multiple gigawatts of energy and data center projects—many already in various stages of development—under Google’s umbrella. This partnership isn’t entirely new: Google and Intersect began collaborating in December 2024, with a vision to colocate data centers alongside clean energy resources. The first fruits of this partnership can already be seen in Haskell County, Texas, where the Quantum Clean Energy Project is under construction. This ambitious site will feature 640 megawatts (MW) of solar generation capacity and 1.3 gigawatt-hours (GWh) of battery storage, all built alongside a new hyperscale data center campus. The project is expected to be completed by late spring 2026, as detailed by pv magazine USA.
Intersect Power’s current portfolio is nothing short of impressive. The company manages $15 billion in assets, either operational or under construction, and boasts 2.2 GW of solar and 2.4 GWh of battery energy storage. By 2028, Intersect expects to have roughly 10.8 GW of capacity online or in development. These are not just numbers on a spreadsheet—they represent the backbone of Google’s strategy to build more data centers while keeping its energy footprint sustainable.
One of the most innovative aspects of this acquisition is the "energy park" model. Rather than relying on the conventional utility-operated grid, Intersect will focus on colocating hyperscale data centers with generation and battery storage assets using a "behind-the-meter" approach. This setup allows Google to bring solar and storage assets directly onsite, thereby mitigating public grid congestion and sidestepping interconnection delays that often slow down large-scale tech expansions. As pv magazine USA notes, this approach gives Big Tech a powerful new tool to scale up rapidly—far outpacing the traditional grid’s ability to keep up.
Intersect will continue to operate as an independent subsidiary under its founder and CEO, Sheldon Kimber, and retain its own brand. Notably, Intersect’s operations will remain separate from Alphabet and Google, allowing the company to continue exploring emerging technologies to increase and diversify the energy supply, all while supporting Google’s U.S. data center investments. However, not all of Intersect’s assets are part of this deal. Operating assets in Texas and California, including several battery energy storage projects, are excluded from the acquisition and will instead be bought out by existing investors to be run as a separate company, according to Jonathan Spencer Jones.
Google’s ambitions don’t stop at Earth’s surface. The company is also exploring the possibility of space-based data centers through its Suncatcher project. The idea? Equip solar-powered satellite constellations with AI workload-optimized cloud tensor processing units, all connected by free space optical links. According to Google’s analysis, such a system could harness solar power almost continuously in orbit, potentially making space the most efficient place to scale AI compute while minimizing the impact on terrestrial resources.
Google states that, with technological advances such as multi-channel dense wavelength division multiplexing transceivers and spatial multiplexing, it should be possible to achieve performance comparable to terrestrial data centers. The satellites would need to fly in close formation—kilometers or less apart—to hit the required power levels. And here’s the kicker: Google estimates that by the mid-2030s, the cost of launching and operating a space-based data center could become roughly equivalent to the energy costs of running a terrestrial one on a per-kilowatt/year basis. Of course, there are significant engineering hurdles to overcome, including thermal management, high-bandwidth communications with the ground, and ensuring on-orbit reliability. To begin tackling these challenges, Google has partnered with satellite company Planet to launch two prototype satellites by early 2027, as reported by Jonathan Spencer Jones.
Back on Earth, Intersect Power has secured a 2.4 GW solar module supply deal with U.S. manufacturer First Solar, running through 2026. The company also inked a 2024 agreement with Tesla for 15.3 GWh of Tesla Megapacks through 2030, ensuring a steady supply of cutting-edge battery technology for its projects. These deals are vital for Google’s strategy, providing the hardware backbone needed for its massive data center and energy ambitions.
The scale of Google’s planned investment is staggering. The company has projected its 2026 capital expenditures for AI infrastructure to reach between $91 billion and $93 billion—nearly double the $52.5 billion spent in 2024, according to pv magazine USA. This surge in spending underscores just how central AI and data center growth have become to Google’s future, and why securing a reliable, affordable, and sustainable energy supply is now mission-critical.
Importantly, Alphabet and Google have emphasized that the acquisition will not pass costs onto grid customers. Instead, the goal is to unlock abundant, reliable, and affordable energy supply, enabling the rapid buildout of data center infrastructure to meet customer demand. As Sundar Pichai summarized, "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."
As the world’s appetite for AI continues to grow, the intersection of technology and energy has never been more crucial—or more fascinating. With this acquisition, Google is placing a bold bet that it can lead the way not just in AI, but in the clean energy solutions that will power the next generation of digital innovation.