The US data centre company Equinix has announced its first long-term renewable energy agreement in the Asia-Pacific region, as colocation providers and hyperscalers sign contracts to green their electricity supply.

On February 7, the world’s biggest colocation data centre provider announced that it has signed a power purchase agreement (PPA) with clean energy producer TagEnergy to buy 151-megawatts (MW) of wind energy from the $3bn Golden Plains Wind Farm – East project in the Australian state of Victoria.

Once the wind project comes online in 2029, the agreement is expected to cover Equinix’s 17 data centres across Australia.

“This first PPA in Asia-Pacific is a huge milestone for Equinix,” Guy Danskine, Equinix’s managing director for Australia, said in a statement, accompanying the announcement. 

Construction on the wind project began in the first quarter of last year and will have 122 wind turbines. It is co-owned by TagEnergy and Netherlands-based holding company Ingka Group, with the former owning 85% of the project. Nearly 20% of the total energy generated by the Golden Plains Wind Farm – East is projected to be sold to Equinix.

“To date, Equinix has executed 21 PPAs globally,” Christopher Wellise, Equinix’s vice president of sustainability, said. “As we expand our global data centre footprint, we will continue to assess opportunities for greening the grids that we move into.” 

PPAs are long-term contracts drawn up between renewable energy providers and corporate consumers, typically where the wind or solar energy is fixed at a certain price. As big energy consumers, data centre providers have been on a push to green the electricity required to power their operations. This has been spearheaded by hyperscalers, such as Google and Microsoft, which have become some of the biggest corporate buyers of renewable energy in the US. 

With data centre investment rising in Asia-Pacific, Equinix reflects the trend of data centre providers looking to tap into PPAs as they expand their reach eastwards. 

In 2019, tech giant Google signed its first PPA in Asia when it agreed to buy the power generated from a 10MW solar array in Tainan City, in the south of Taiwan.  

Kevin Hagen, interim CEO of the Clean Energy Buyers Association, said in the statement that PPAs have “changed the electricity market in the US and Europe”.

“Now, high-impact deals like this are helping to lead the effort to drive local demand and shift markets in regions where there is even more opportunity for decarbonisation such as Australia, India and Southeast Asia,” he added.

Foreign direct investment into data centres in Asia-Pacific has also been rising. Announced greenfield projects in data processing, hosting and related services surged to a record $26.5bn, according to investment monitor fDi Markets.

By 2030, Equinix has targeted to become carbon neutral across its scope one and scope two emissions globally, referring to the carbon emissions produced directly and indirectly by its own operating systems.