Google Buys Power Before It Builds Data Centres

Ruth Porat gave the strategy a name in Helsinki. 'We call this BYOP, bring your own power,' Google's president and chief investment officer told reporters on 9 September, announcing the company's first nuclear energy deal outside the United States. Eight days earlier Google had signed the largest enhanced-geothermal power purchase agreement on record. Together the two contracts show what the hyperscaler energy strategy has become: pay for clean firm capacity directly, and in some cases decide whether it exists at all.

Geothermal at scale

On 1 September Fervo Energy announced a 396 MW power purchase agreement with Google from its Cape Station enhanced geothermal project in Utah, expected online in 2028, with a Google option for roughly 600 MW more, for nearly a gigawatt, by June 2030. Reuters reported Fervo shares rising nearly 14% in premarket trading. Fervo describes the contract as the world's largest enhanced geothermal PPA and as a foundational building block for a potential Google data centre in Utah, subject to engineering feasibility, approvals and commercial conditions. Chief executive Tim Latimer said the agreement 'reinforces that EGS is ready to power the next generation of computing infrastructure'.

Enhanced geothermal drills into hot rock where no natural reservoir exists and fractures it to circulate water, borrowing techniques from shale drilling. Cape Station's first phase is 100 MW; the Google contract is part of the expansion beyond it. Fervo notes that Utah's SB132 could, subject to regulatory approval, allow direct-to-load contracting, and says the deal adds capacity at no cost to existing ratepayers.

Nuclear in Finland

The Finland deal came inside a broader package: at least €13 billion, about $15.1 billion, in AI infrastructure over 2027 and 2028, including new data centres in the north, which Reuters described as Google's biggest investment in Europe. Fortum's stock-exchange release sets out the nuclear terms: a power purchase agreement starting in 2028 at smaller capacity and reaching 50% of Loviisa's capacity for 2030 to 2049. Fortum shares jumped 15.5% to a four-and-a-half-year high, the biggest gain in Europe that day.

What the contract buys is the plant's future. Google's release says that without Fortum's lifetime-extension programme, Loviisa, with about 580 employees and roughly 10% of Finland's electricity, could not continue operations beyond 2030. Fortum puts the programme at about €1 billion from 2023 to 2050, of which roughly 80% of projects and €700 million of capital expenditure are still pending investment decisions. The PPA is expected to lift Fortum's comparable return on net assets by about 1.4 percentage points once the 50% level is contracted. A memorandum of understanding will explore new reactors at Loviisa plus new generation and flexibility capacity, and the package includes onshore wind and a 94 MW battery at Kajaani to stabilise prices during cold, windless periods.

The pushback

The political reaction was immediate. On 10 September Reuters reported that Finland's opposition Centre Party and Social Democrats called for a national data-centre permitting system, warning of power-shortage and price risks after the Google announcement. In Utah, Governor Cox issued an order in May to protect the Great Salt Lake and air quality from data-centre development, and the location of Google's planned Utah facility remains undisclosed. Both deals arrive as Alphabet raised its 2026 capital-expenditure guidance to between $195 billion and $205 billion.

Who benefits, who is at risk

Beneficiaries: enhanced-geothermal developers with proven projects, owners of existing nuclear plants facing extension decisions, and regions with cold climates and clean grids. At risk: ratepayers and neighbouring industry if data-centre demand outruns generation, and governments that lack permitting frameworks for gigawatt-scale loads.