Dive Brief:
- Intersect Power is partnering with Google and TPG Rise Climate, a subsidiary of private equity firm TPG, to drive up to $20 billion in renewable power infrastructure investment to power new data centers and scaling clean energy generation by the end of the decade, the companies said last week.
- The partnership’s “power-first” approach will involve colocating data centers with Google as an anchor tenant near “large amounts of high capacity factor, low-cost, clean electricity and added battery storage [to] achieve high percentages of renewable energy,” while reducing the need for new transmission infrastructure, the companies said in a Dec. 10 news release.
- “The scale of AI presents an opportunity to completely rethink data center development — by colocating them where possible with the grid-connected carbon-free energy that keeps them up and running,” Amanda Peterson Corio, global head of data center energy at Google, said in a statement.
Dive Insight:
By 2030, Google aims to achieve net-zero emissions across its operations and value chain and reduce its combined Scope 1, 2 and 3 absolute emissions by 50% from 2019 levels, the company says. The tech giant also plans to “invest in nature-based and technology-based carbon removal solutions to neutralize our remaining emissions,” according to its sustainability website.
Amid an artificial intelligence boom driving a rapid increase in data centers’ power consumption, however, Google’s total greenhouse gas emissions increased 13% year over year to 2023, according to its 2024 Environmental Report released in July.
For years, Google and other tech giants have offset GHG emissions from electricity consumption and other activities through direct and virtual power purchase agreements with wind and solar power facilities. More recently, Meta signed an agreement with geothermal energy firm Sage Geosystems to power its data center growth and boost its renewable energy use, while Amazon announced deals with three energy companies to develop and deploy modular nuclear reactors.
But those technologies are earlier in the commercialization process than wind, solar and battery energy storage and thus unlikely to be widely deployed until the next decade, according to the U.S. Department of Energy’s next-generation geothermal and advanced nuclear commercial liftoff reports. In contrast, the first clean energy project to be developed under the Intersect-Google-TPG partnership is expected to be operational by 2026 and “fully complete” by 2027, the companies said.
“No one else is [developing] on this timeline,” Intersect Power founder and CEO Sheldon Kimber said in an interview. Kimber declined to describe the scope or location of the first project but said an announcement would be coming “shortly.”
“We expect this partnership to achieve unprecedented scale at our first colocated project, and we have set ourselves on a course to deliver several more large scale colocated data centers and clean energy power plants across the U.S.,” Ed Beckley, managing partner at TPG Rise Climate, said in a statement.
Intersect wants to develop “powered land” with robust electric generation and distribution infrastructure for large data centers in regions with high-quality wind and solar resources, said Kimber, whose company on Tuesday also announced more than $800 million in a funding round led by Google and TPG Rise Climate.
A one-gigawatt data center colocated with a GW each of wind, solar and battery storage could satisfy up to 80% of its annual power needs from those carbon-free resources and make up the difference with grid electricity, Kimber said.
Rather than placing additional stress on the electric grid by “[demanding] power at the worst possible time,” such as a hot summer evening or cold winter morning, Intersect’s data centers “can actually support the grid” by drawing power from colocated renewables or batteries during those peak periods and relying on the grid only during periods of lower demand, Kimber added.
Even in areas with high-quality renewable resources, data centers may need gas-fired backup generators in the near term to mitigate grid outages or long periods of low wind and sun, Kimber said. As lithium-ion battery prices fall and emerging longer-duration energy storage technologies, like Form Energy’s iron-air batteries, become cost-competitive, however, data center operators “can start to squeeze out reliance on the grid and fossil fuel backup,” he said.
