Digital Edge, a leading data center platform in the Asia-Pacific, has launched its first Green Finance Framework to guide sustainable project funding. This move aims to align the company’s expansion with its ambitious environmental, social, and governance (ESG) goals, including its commitment to becoming carbon-neutral by 2030. The framework addresses the growing demand for eco-friendly infrastructure, especially as AI and other energy-intensive technologies expand across the region.
Defining the Criteria for Green Projects
The new framework establishes four clear and strict conditions that all projects must satisfy to be eligible for green financing. This ensures that capital is directed toward initiatives with measurable environmental benefits. Digital Edge is focusing on creating a data infrastructure that is both high-performing and sustainable.
These core criteria are designed to cover the most critical aspects of a data center’s environmental footprint, from energy consumption to building materials. This structured approach provides a transparent roadmap for sustainable development.
The four pillars of the framework are:
- Energy Efficiency: Projects must meet specific Power Usage Effectiveness (PUE) targets. The required PUE is 1.30 or lower for facilities in cooler climates and 1.40 or lower in warmer regions.
- Renewable Energy: A significant portion of power for the data centers must come from renewable sources to decrease reliance on fossil fuels.
- Green Buildings: Facilities must adhere to internationally recognized green building standards in their design, construction, and operation.
- Sustainable Water and Wastewater Management: Projects need to include advanced systems for water conservation and recycling to minimize waste.
Each category is supported by specific performance indicators to track progress and ensure accountability.
Aligning Financial Growth with ESG Goals
Jonathan Walbridge, the Chief Financial Officer at Digital Edge, stated that the framework is central to the company’s growth strategy. He highlighted that integrating ESG commitments early on is crucial for long-term success. “As we tackle rising demand from energy-intensive tech like AI, this framework is instrumental in ensuring our funding strategy aligns with sustainability goals,” Walbridge noted.
To ensure transparency, an ESG Steering Committee will oversee the process, with progress detailed in Digital Edge’s annual ESG Report. This allows stakeholders to monitor the real-world impact of the green-financed projects.
The framework has already received a strong endorsement, earning an SQS2 sustainability score from Moody’s, which signifies a “very good” rating. It also aligns with major international standards, including the Green Bond Principles (GBP) and the Green Loan Principles (GLP).
Strategic Partnerships Bolster Green Initiative
The development of the framework was supported by prominent financial institutions, with Crédit Agricole CIB and ING Bank N.V. acting as Green Structuring Coordinators. These partnerships demonstrate the growing collaboration between the tech and finance sectors to advance sustainability.
Carmen Tsang of Crédit Agricole CIB praised the initiative, stating, “The Green Finance Framework sets a commendable example within the sector.” Similarly, Andrew Chew from ING highlighted the bank’s commitment to helping data center providers enter the green finance market.
South Korea Project Sets a Precedent
Digital Edge has already demonstrated its commitment to these principles through its financing for the SEL2 data center in Seoul, South Korea. Last year, the company secured a KRW 440 billion green loan for the project.
This was the first green loan for a data center project in South Korea and serves as a powerful example of green financing in action. The SEL2 financing adheres to the principles now formalized in the new framework, showing the company’s consistent approach to sustainable investment. The project is a blueprint for future developments in the region.
