Actions speak louder: Sustainability in our portfolio

Examples of how Siemens Financial Services' invests with an Environmental, Social, and Governance (ESG) mindset. 

Today, we’re at an inflection point. We are living in what the United Nations calls “The Decade of Action,” ending in 2030. That means one thing: we must act now and make meaningful change.

 

For business, being sustainable and purpose-driven is not only a competitive advantage; it’s an imperative. Many organizations recognize the importance of building sustainability initiatives in their business growth strategy, yet they struggle to access budget. As a leader who works with companies across all industries and of all sizes, it’s clear to me that we can make energy-efficient infrastructure more attainable for all through financing.

 

At Siemens Financial Services (SFS), we invest with an Environmental, Social, and Governance (ESG) mindset, providing financing for customers across a wide range of sectors. Here are some examples of how we approach this imperative:

We help our clients lead in sustainability by combining unique financing solutions with our access to, knowledge of, and experience with Siemens technology.

Carpinteria Valley Water District: Carpinteria Valley Water District spans over 11,300 acres and provides potable water to approximately 15,500 people at a reasonable cost. Siemens Smart Infrastructure (SI) worked with the district to implement innovative plans to improve water and energy efficiency including digital water meters, solar panels and LED lighting. SFS responded with competitive rates and a tailor-made package with performance guarantees. Managing clean water supply is an energy-intensive process and, with this solution, the District was able to upgrade its infrastructure and provide water to residents in a renewable, energy-efficient way, further offsetting energy expenses.

 

Cascade Power Project: The province of Alberta contributes over 50% of Canada’s greenhouse gas emissions. The Cascade Power Project, a 900 MW combined cycle power plant in Alberta, utilizes Siemens Energy’s technology and services to reduce those emissions. SFS was invited to participate in the project as a Coordinating Lead Arranger and provided a CAD $75 million Senior Secured Construction Term Loan. The project will result in one of the largest emissions reduction opportunities in the country’s electricity sector and won Project Finance International's Canadian Power Deal of the Year award for 2020, for its innovative long-term contracting strategy and First Nations partnership.

We want our customers by our side as we achieve our sustainability goals during this Decade of Action.

Pattern Energy: Since 2011, SFS and Pattern Energy, one of the world's largest privately owned developers of wind energy projects, have worked together to empower the use of renewable wind energy across North America, with SFS committing $1.7 billion to 23 of Pattern Energy's projects. Those projects have generated a combined 4.4GW of wind energy, and the relationship is ongoing. The duo built the first-ever wind project in Puerto Rico, bringing renewable energy and jobs to Latin America. Additionally, nearly 90% of the projects financed by SFS use Siemens technology and services.

 

Signature Healthcare: Signature Healthcare is an award-winning health system, located in Massachusetts, with 550 affiliated physicians across seven locations. In 2016, Signature Healthcare began working with Siemens to identify critical upgrades to its HVAC system at its primary hospital campus. This led to the development of a $9 million infrastructure improvement plan, for which Signature needed a financing solution that included funding for the improvements. With SFS, Signature Healthcare was able to fund the plan and refinance its existing bonds at a lower rate through an attractive 10-year debt package totaling $50 million. This allowed Signature Healthcare to improve its infrastructure, simplify its debt structure, reduce CO2 emissions by 7.6 million pounds, and provide greater financial flexibility and stability.

We seek opportunities that align with our objective of investing in markets that represent a more sustainable future.

80 Acres Farms: 80 Acres Farms is a vertical farming leader, providing customers with the freshest and most nutritious fruits and vegetables at affordable prices. Utilizing innovative technology and analytics, it offers customers a wide variety of pesticide-free food with a longer shelf-life that exceeds the highest standards in food safety.  Their vertical farms shorten the farm-to-table footprint, reduce food waste, and use 97% less water than traditional farming practices – all powered by renewable energy. SFS is in the club of investors that just committed $160 million to the global expansion and development of 80 Acres Farms.

 

AMPLY Power Inc: Fleet conversion from fuel to electricity requires investments in charging equipment, electric infrastructure, and software while exposing a fleet operator to significant new challenges such as energy procurement and price volatility. AMPLY Power Inc is a California-based platform that provides Charging-as-a-Service (CaaS) to de-risk and accelerate the adoption of electric vehicles by commercial fleet operators through its simple price-per-mile-driven model and no up-front capital investment requirement. SFS invested in AMPLY to accelerate deployment of this strategy, enabling electric fleets for decarbonization.

 

Brasol: Brasol is a distributed solar energy company in Brazil, targeting commercial and industrial customers with Energy-as-a-Service (EaaS) – meaning it’s responsible for purchasing, installing and managing solar power systems on behalf of its customers; customers benefit from immediate savings without the up-front payments or hassle of owning the system. Through its 49% stake, SFS provides the equity capital Brasol needs to develop and de-risk project portfolios large enough to attract institutional investors. SFS’ investment in Brasol underscores our commitment to renewable energy and the growing digitalization of the electricity sector.

We believe that financing is key in implementing ESG initiatives that will determine a company’s long-term value.

Calibrant Energy: Calibrant Energy was established in 2020 by Macquarie’s Green Investment Group (GIG), Siemens Smart Infrastructure (SI), and SFS to help advance distributed energy systems (DES) projects. It offers Energy-as-a-Service (EaaS) solutions at no up-front cost to customers including corporate and industrial clients, municipalities, universities, schools, and hospitals. Calibrant Energy enables customers to access the benefits of on-site energy systems with a new level of simplicity and immediate savings. Its technologies will include solar, centralized HVAC infrastructure upgrades, and more.

 

SFS participated with an equity investment and created a 4-year revolving credit facility with a credit limit of up to $100 million to fund the development and construction of Calibrant’s energy projects. Combining Siemens’ innovative technology solutions and – together with GIG – adding our own financing and risk management expertise, Calibrant Energy will help enable customers to obtain resilient low-cost energy and meet sustainability goals with no up-front cost.

 

Crown Castle: Crown Castle is a communications infrastructure company headquartered in Houston, Texas that owns, operates and leases more than 40,000 cell towers and approximately 80,000 route miles of fiber supporting small cells and fiber solutions across every major U.S. market. SFS and other lenders provided Crown Castle with a sustainability linked loan in June 2021. The credit facility pricing is subject to adjustment based on KPIs including Crown Castle’s commitment to renewable energy and conversion to LED lights on certain cell towers over a 5-year period. Through this credit facility, Crown Castle is incentivized to be greener.

 

Dyess Air Force Base: Siemens Government Technologies (SGT) designed a $60 million plan for energy efficiency upgrades to cooling, heating, lighting, and water conservation systems on Dyess Air Force Base in Abilene, Texas. With SFS’ help, SGT self-financed the construction period in a way that reduced financing costs for the customer, allowing them to pay for the upgrades with the more than $4.5 million in annual energy savings.

By: Anthony Casciano, President and CEO, Siemens Financial Services Americas