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The great AI energy land grab

The great AI energy land grab

Built World
By Newzino Staff | |

How tech giants are buying power plants to bypass the grid

December 22nd, 2025: Alphabet Acquires Intersect Power for $4.75 Billion

Overview

Alphabet just paid $4.75 billion for a power company. Not a tech company that happens to use power—an actual infrastructure firm that builds solar farms and data centers. The deal gives Google control over 10.8 gigawatts of generating capacity, enough to power 8 million homes. Tech giants spent 2024 locking down nuclear reactors, buying stakes in power plants, and signing multi-billion dollar energy deals because the AI boom hit a hard limit: there's not enough electricity. By December 2025, the federal government joined the race—the Department of Energy opened federal land at Oak Ridge for nuclear-powered AI data centers, while advanced nuclear startups raised over $500 million in a single week.

The utilities can't keep up. When 60 data centers in Virginia briefly went offline in 2024, they nearly crashed the entire grid. Dominion Energy started telling data center developers their power won't be ready until 2026. Gartner predicts 40% of AI data centers will face power shortages by 2027. So tech companies stopped waiting. Amazon bought a data center campus wired directly into a nuclear plant. Microsoft is restarting Three Mile Island. Google ordered a fleet of small modular reactors and expanded its partnership with NextEra Energy to develop 15 gigawatts of power by 2035. The message: if the grid can't deliver, we'll build our own—and now the government is helping.

Key Indicators

165%
Projected growth in data center power demand by 2030
Goldman Sachs forecast from 2024 baseline
15 GW
Power capacity NextEra will build for data centers by 2035
Announced in partnership expansion with Google, December 2025
$500M+
Nuclear startup funding raised in one week
Radiant, Last Energy, ARC Clean Technology combined, December 2025
40%
AI data centers constrained by power shortages by 2027
Gartner prediction from November 2024

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People Involved

Sundar Pichai
Sundar Pichai
CEO, Alphabet Inc. (Leading $4.75B Intersect acquisition)
Sheldon Kimber
Sheldon Kimber
CEO and Co-Founder, Intersect Power (Selling company to Alphabet for $4.75B)
Ruth Porat
Ruth Porat
President and Chief Investment Officer, Alphabet (Overseeing infrastructure and data center investments)
Joel Bradburne
Joel Bradburne
Acting Assistant Secretary for Environmental Management, U.S. Department of Energy (Leading Oak Ridge AI data center initiative)

Organizations Involved

Intersect Power
Intersect Power
Energy Infrastructure Developer
Status: Being acquired by Alphabet for $4.75B

Intersect co-locates data centers with dedicated clean power generation, bypassing utility grid bottlenecks.

Alphabet Inc.
Alphabet Inc.
Technology Conglomerate
Status: Acquiring power infrastructure to fuel AI expansion

Google's parent company, now vertically integrating into power generation for AI data centers.

NextEra Energy, Inc.
NextEra Energy, Inc.
Energy Company
Status: Building 15 GW of power for data centers by 2035

America's largest electric utility by market cap, now pivoting to become a major data center power provider through nuclear restart and gigawatt-scale campus development.

Radiant Nuclear
Radiant Nuclear
Nuclear Technology Startup
Status: Building portable microreactor factory in Oak Ridge

Developer of portable 1-megawatt nuclear microreactors designed to replace diesel generators at remote sites.

Last Energy
Last Energy
Nuclear Technology Startup
Status: Building pilot SMR at Texas A&M, targeting 2026 criticality

Small modular reactor developer focused on factory-built nuclear units for industrial power.

U.
U.S. Department of Energy
Federal Agency
Status: Opening federal land for nuclear-powered AI data centers

Federal agency responsible for energy policy, nuclear weapons, and national laboratories—now facilitating private AI infrastructure on government property.

Timeline

  1. Alphabet Acquires Intersect Power for $4.75 Billion

    Acquisition

    Alphabet announces definitive agreement to buy energy infrastructure provider Intersect, gaining 10.8 gigawatts of power generation and data center projects.

  2. Radiant Raises $300M+ for Portable Nuclear Reactors

    Investment

    Radiant Nuclear closes over $300 million funding round led by Draper Associates and Boost VC to build factory for mass-produced portable microreactors in Oak Ridge, Tennessee.

  3. ARC Clean Technology Closes Series B for Advanced SMRs

    Investment

    ARC Clean Technology announces successful Series B close with investors including Xplor Ventures and Hennessy Capital Group for advanced SMR development.

  4. Last Energy Closes $100M+ Series C for SMR Development

    Investment

    SMR developer Last Energy closes oversubscribed $100 million Series C led by Astera Institute to complete PWR-5 pilot reactor at Texas A&M, targeting 2026 criticality.

  5. NextEra Commits to 15 Gigawatts for Data Centers by 2035

    Energy Deal

    NextEra Energy announces plan to build 15 gigawatts of new power generation for data center hubs by 2035, expanding Google partnership to develop three gigawatt-scale campuses.

  6. DOE Proposal Deadline for Oak Ridge Nuclear AI Data Centers

    Government

    Department of Energy closes submissions for companies to build nuclear-powered AI data centers on federal land at Oak Ridge Reservation, calling it "Manhattan Project 2.0."

  7. Google and NextEra Partner to Restart Iowa Nuclear Plant

    Energy Deal

    NextEra Energy and Google announce plans to restart Iowa's Duane Arnold Energy Center nuclear facility by Q1 2029, plus develop nuclear-powered gigawatt-scale data center campuses across the U.S.

  8. Gartner Predicts 40% of AI Data Centers Face Power Shortages

    Analysis

    Gartner forecasts power availability will operationally constrain 40% of existing AI data centers by 2027 as demand reaches 500 terawatt-hours annually.

  9. Google Orders Fleet of Small Nuclear Reactors

    Energy Deal

    Google signs first-ever corporate SMR deployment agreement with Kairos Power for 500 megawatts across six to seven reactors, online 2030-2035.

  10. Microsoft Signs Deal to Restart Three Mile Island

    Energy Deal

    Constellation Energy and Microsoft announce 20-year power purchase agreement to reopen shuttered Unit 1 reactor by 2028, delivering 835 megawatts.

  11. Virginia Grid Nearly Crashes

    Infrastructure

    60 data centers in Fairfax County drop offline simultaneously, pulling 1,500 megawatts off the grid and nearly triggering widespread blackouts.

  12. Amazon Buys Nuclear-Powered Data Center for $650M

    Acquisition

    Amazon acquires a 960-megawatt data center campus in Pennsylvania wired directly into the Susquehanna nuclear plant, pioneering the bypass-the-grid model.

  13. ChatGPT Launches, AI Energy Crisis Begins

    Technology

    OpenAI releases ChatGPT to the public, triggering an AI arms race. A single ChatGPT query uses 10 times the energy of a Google search.

Scenarios

1

Big Tech Becomes Big Energy

Discussed by: Goldman Sachs, IEA, industry analysts tracking infrastructure spending

Tech companies complete vertical integration into power generation, owning nuclear plants, solar farms, and battery storage to guarantee supply. Alphabet, Microsoft, Amazon, and Meta collectively control 50+ gigawatts by 2030. This fragments the utility model but ensures AI development isn't bottlenecked by grid constraints. Regulators approve deals because tech spending accelerates clean energy buildout faster than utilities could manage. The downside: residential customers see bills rise as utilities lose their largest customers and tech companies negotiate preferential rates.

2

The Grid Wins, Tech Pays Premium Prices

Discussed by: Utility industry groups, energy regulators

FERC and state regulators block or heavily restrict behind-the-meter power arrangements after Amazon's Susquehanna deal faces pushback. Utilities force tech companies back to the grid but demand massive upfront infrastructure payments. Data center power costs triple. Some AI projects become economically unviable. Tech companies shift more compute to regions with excess power—Texas, parts of the Midwest—creating new geographic bottlenecks. Google's SMR fleet and Alphabet's Intersect projects proceed but must sell power through utility intermediaries, adding costs and delays.

3

AI Bubble Bursts, Dark Data Centers

Discussed by: Tech skeptics, financial analysts drawing dot-com parallels

The AI boom follows the 2000 fiber optic playbook: massive infrastructure buildout chasing inflated demand projections. By 2028, 60% of planned data center capacity sits idle as AI hype deflates and actual revenue models fail to materialize. Alphabet's $4.75 billion Intersect bet becomes a write-down. The power infrastructure eventually gets used—just not by the companies that built it. Small modular reactors face years of additional regulatory delays. The silver lining: overcapacity drives power prices down and accelerates the clean energy transition, but tech shareholders take losses comparable to the telecom crash.

Historical Context

Dot-Com Fiber Optic Overcapacity (1995-2001)

1995-2001

What Happened

Telecom companies spent over $500 billion laying 80-90 million miles of fiber optic cable, driven by wildly inflated projections that internet traffic doubled every 100 days. The actual growth rate was half that. When the bubble burst in 2000, 95% of installed fiber sat unused—dubbed "dark fiber." Dozens of telecom companies collapsed under debt loads they couldn't service.

Outcome

Short Term

Catastrophic overcapacity, telecom bankruptcies, investor losses in the trillions.

Long Term

The infrastructure eventually got used. Cheap fiber accelerated broadband adoption and enabled the modern internet economy, just not for the companies that built it.

Why It's Relevant Today

Tech giants are spending comparably on AI power infrastructure based on growth projections that may prove optimistic. History suggests overcapacity risk is real but infrastructure often finds uses beyond original intent.

Oil Industry Vertical Integration (1870s-1911)

1870-1911

What Happened

John D. Rockefeller built Standard Oil by vertically integrating every stage of the oil business—production, refining, transportation, distribution. By controlling the entire supply chain, Standard Oil eliminated dependency on external suppliers and achieved 85% market dominance. The strategy worked until antitrust regulators broke up the company in 1911.

Outcome

Short Term

Unmatched market control, massive profitability, and the creation of America's first business empire.

Long Term

The breakup created multiple successor companies (ExxonMobil, Chevron) that remained industry leaders. Vertical integration became standard practice for energy companies globally.

Why It's Relevant Today

Alphabet and peers are pursuing vertical integration into power generation to control AI infrastructure costs and guarantee supply—the same logic that drove Rockefeller. Regulatory scrutiny over market power is likely.

Utility Grid Buildout (1920s-1950s)

1920-1950

What Happened

The U.S. built centralized electrical grids to serve growing industrial and residential demand. Rural electrification expanded access but required massive public and private investment. Utilities became regulated monopolies with guaranteed returns in exchange for universal service obligations. The model delivered reliable, affordable power for decades.

Outcome

Short Term

Electrification of America, powering industrial growth and rising living standards.

Long Term

The centralized grid became critical infrastructure but also created single points of failure and limited innovation. Deregulation efforts in the 1990s-2000s produced mixed results.

Why It's Relevant Today

The utility model is breaking under AI data center load. Tech companies building dedicated infrastructure may represent the biggest challenge to the centralized grid since its creation, potentially forcing a new regulatory and operational paradigm.

17 Sources:
+11
Alphabet Investor Relations Bloomberg TechCrunch Goldman Sachs Gartner CNBC Google Blog American Nuclear Society Data Center Dynamics International Energy Agency U.S. Department of Energy Roll Call NextEra Energy Neutron Bytes Power Magazine CNBC TechCrunch