This case study was published in the 2022 REIT Industry ESG Report, which details the REIT and publicly traded real estate industry's environmental, social, and governance (ESG) performance and features 32 case studies showcasing REIT leadership and ESG innovation from a variety of sectors. The report serves as a practical tool for shareholders and stakeholders to assess the scale and impact of the REIT industry's ESG commitments and initiatives. Applicable footnotes and/or citations for this case study are available in the full report.
Utilizing a Transparent Financing Framework for Green Bonds
While advancing its ESG commitments with green finance, Equinix, Inc. focused on transparency for its Green Finance Framework and allocation reporting.
Equinix’s comprehensive green financing strategy is integral to advancing its sustainability initiatives. Equinix developed its Green Finance Framework based on International Capital Market Association’s (ICMA) Green Bond Principles and Green Loan Principles. These principles are a set of guidelines that promote transparency and integrity and advance the standardization of green debt disclosures. Since September 2020, Equinix has issued $4.9 billion in green bonds.
As outlined in Equinix’s Green Finance Framework, the net proceeds of its green bonds will be allocated to finance or refinance eligible green projects in categories including green buildings, renewable energy, energy efficiency, sustainable water and wastewater management, waste management, and clean transportation. Within its Green Finance Framework, Equinix clearly details the eligibility criteria for each project category and how the projects contribute to the UN Sustainable Development Goals. Equinix’s framework will increase its focus on protecting the environment and addressing global climate change through greenhouse gas emissions reductions, increasing resource efficiency, and driving corporate transparency and accountability.
“Equinix’s green bonds have aligned our sustainability strategy with our financing needs, accelerating our ability to advance our sustainability initiatives and to achieve our ambitious goals.”
-Jennifer Ruch, Senior Director, Sustainability, Equinix, Inc.
In 2021, Equinix issued its inaugural Allocation and Impact Report where it allocated $2.9 billion of net proceeds from its green bonds and provided details on the use of proceeds for each bond, including the net proceeds that were allocated to the project categories of green buildings, renewable energy, and energy efficiency. Equinix also disclosed the carbon and energy impacts associated with the allocated funds. The eligible projects included in Equinix’s allocation resulted in an annual energy savings of nearly 1.5 million MWh and an annual carbon reduction of nearly 600,000 MTCO2e.
Equinix further highlights key projects included in the allocation to provide tangible examples of the use of proceeds to investors and other stakeholders. One highlighted project was the development of SV11 Phase 1, a state-of-the-art International Business Exchange (IBX) data center in San Jose, California. The data center was built to an ultra-low design average annual Power Usage Effectiveness (PUE) of 1.17, a measure of data center energy efficiency, and to LEED Gold standards. The IBX resulted in the avoidance of 1,756 MTCO2e, equivalent to the greenhouse gas emissions from approximately 380 passenger vehicles driven for one year,1 on an annual basis when compared to industry average PUEs.
The transparency of Equinix’s Green Finance Framework and its robust Allocation and Impact Report has garnered positive feedback from the company’s shareholders and stakeholders. Equinix plans to continue to explore green financing opportunities to drive impact. Equinix remains committed to transparency, and accountability will remain central to its green financing strategy.
Equinix, Inc. is the world’s digital infrastructure company, enabling digital leaders to harness a trusted platform to bring together and interconnect the foundational infrastructure that powers their success. Equinix enables today’s businesses to access all the right places, partners, and possibilities they need to accelerate advantage.