Switch: US$2.6bn Deal Backs Data Centre Power Strategy

Switch has secured a US$2.6bn syndicated performance letter of credit (LC) facility, marking a new approach to financing power infrastructure for large-scale data centre developments.

The provider of AI, cloud and enterprise data centre infrastructure says the LC facility is the first of its kind in the sector.

The deal will strengthen the company's ability to procure power at scale while supporting the build-out of new transmission and generation resources across its portfolio of gigawatt-scale campuses.

Structured as a standalone facility, separate from Switch’s existing revolving credit and borrowing base arrangements, the performance letter of credit backs obligations tied to energy infrastructure projects.

By structuring the facility across multiple financial institutions, Switch will gain access to greater credit capacity at lower cost while improving execution certainty for utilities and customers operating in power-constrained markets.

Financing power for hyperscale growth

The facility is designed to underpin several core aspects of Switch’s expansion strategy, including advancing power procurement, backing new transmission and generation developments and enabling large-scale campus buildouts.

“This facility represents a significant advancement in how digital infrastructure companies secure power at scale,” says Jesse Burros, Chief Investment Officer at Switch.

“Energy investments increasingly require credit support, and this broadly syndicated solution will lower our costs and streamline our ability to commit to large-scale development projects.”

Addressing energy constraints in key markets

Switch currently operates two gigawatt-scale data centre campuses in Nevada. Despite their substantial footprint, the company said that power rates for Nevada residents has declined year-on-year, contrasting with broader increases in electricity costs across the US.

The company’s approach centres on aligning infrastructure investment with energy development, ensuring that power availability keeps pace with demand from large-scale digital workloads.

The new facility is expected to play a central role in this model by providing the financial backing required to accelerate utility-led projects.

“As data center industry growth drives demand for new transmission and generation in the U.S., developers and operators are seeking more efficient, lower-cost capital solutions,” says Jon Edwards, EVP and Head of Capital Markets at Switch.

“Given the strong demand for this type of facility, we expect to upsize it as we continue to grow.”

Scaling infrastructure alongside energy supply

Switch has raised more than US$24bn in financing since 2024, combining investment-grade rated instruments on stabilised assets with more than US$10bn in revolving capital commitments to support new developments.

A syndicated performance letter of credit facility builds on this financial strategy, enabling the company to align large-scale campus expansion with the delivery of supporting energy infrastructure.

As AI workloads drive higher utilisation and density within data centres, operators are increasingly required to secure reliable, continuous power at unprecedented scale.

This is placing pressure on traditional utility development timelines, prompting closer collaboration between developers and energy providers.

“AI infrastructure requires reliable, around-the-clock power at a scale and speed that utility development timelines often cannot match on their own,” says Alise Porto, SVP of Power and Sustainability at Switch.

“To facilitate this growth, we actively partner with utilities by providing financial certainty to help expand energy infrastructure while also protecting local ratepayers.”

Supporting long-term data centre expansion

The facility is expected to support Switch’s continued expansion across its gigawatt-scale campuses, ensuring that power procurement and infrastructure delivery remain aligned as demand for AI and cloud capacity grows.

By separating the performance letter of credit from its broader credit facilities, Switch has created a dedicated financing tool focused on energy infrastructure, allowing for more targeted deployment of capital in support of its data centre operations.

This approach provides a framework for managing the increasing complexity of power procurement in large-scale data centre environments, where access to reliable energy is becoming as critical as connectivity and location in determining development timelines.

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