Asset-backed/asset-based green bond of the year: Aligned Energy

Building on last year's win as a highly commended sustainability-linked loan of the year in the 2021 Environmental Finance Bond Awards, data centre developer Aligned Energy tapped the bond market with its inaugural $1.35 billion green securitisation.

Dan ShureyThe issue combines energy and water efficiency thresholds to address some of the most materially relevant environmental, social and governance (ESG) issues to the data centre industry.

Aligned stated that, in addition to being the first green securitisation from a data centre operator to include both water and energy efficiency metrics, it is the first securitisation to be fully allocated to green data centres.

Aligned's Green Financing Framework defines green data centres as those with power usage effectiveness (PUE) of 1.35 or below with water-based cooling technologies, or a PUE of 1.45 or below with water-free cooling technologies.

The framework received a second party opinion from Sustainalytics that determined it to be credible, impactful and aligned with the four pillars of the Green Bond Principles and Green Loan Principles.

"After completing the first sustainability-linked-loan for data centres, the Green ABS deal of the year award continues to showcase Aligned's sustainability leadership, now tied to several sustainable finance instruments," said Dan Shurey, director of sustainable finance, Americas at ING. "ING is a proud partner and congratulates Aligned on this impressive achievement."

The $1.35 billion green security consisted of a $1.05 billion fixed-rate tranche with a rating of A- from S&P, a $150 million floating rate trance, also with an A- rating by S&P, and a $150 million fixed-rate tranche, with a BBB rating from S&P.

ING acted as sole sustainability agent on the issue as well as co-manager.

Deal Highlights

Issuer: Aligned Energy
Sector: Energy
Instrument: Asset-backed green bond
Issue size: $1.35 billion
Maturity date: expected maturity Aug 2026 / legal final maturity Aug 2046
Settlement date: 25 August 2021
Coupon: 1.94% & 2.48%
Lead managers: ING
Use of Proceeds: Green data centres
External review/Second opinion: Sustainalytics
Credit rating: S&P (A- & BBB)
Principles/Guidelines: Green Bond Principles