MOUNTAIN VIEW, Calif. (AP) – Google’s corporate parent on Monday announced an agreement to buy data center energy specialist Intersect for $4.75 billion as part of its effort to secure the vast amounts of electricity needed to power artificial intelligence technology.
Alphabet, which depends on Google’s search engine and other online services for most of its revenue, is buying out Intersect in its entirety after purchasing a stake in the San Francisco-based startup a year ago. Intersect had previously raised $2.1 billion from Google and other early investors.
After the acquisition is completed during the first half of next year, Alphabet intends to allow Intersect to operate independently while continuing its efforts to secure the energy sources needed for the sprawling data centers being built to power the AI services rolling out from Google and rivals such as OpenAI.
The power-hungry data centers, which are being likened to AI factories, is fueling a backlash in communities where residents have been interpreting their steadily rising electricity bills as evidence that they help helping footing the boom for a technology boom that could still go bust.
Intersect focuses on finding ways to increase and diversify the supply of energy in an effort to keep hold down power costs. It’s already working on a data center for Mountain View, California-based Alphabet in Haskell County, Texas.
Google’s inroads with AI has helped increase Alphabet’s stock price by more than 60% so far this year, generating an additional $1.4 trillion in shareholder wealth.
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