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A Surprising Bond ETF for the Data Center Moment

BY | ETF Database
7:05 am ET 09/03/26 | 40 VIEWS
The data center story is constantly making headlines. What started about demand — still a key factor — has become about financing, with environmental implications.Consider some of the recent headlines pertaining to the space. Policymakers across both blue and red states are introducing moratoriums on data center construction. Local environmental concerns are the most often-cited reason. This could open the door for the VanEck Green Bond ETF (GRNB ). The need for data center financing isn’t waning. However, the impetus to build these facilities in an environmentally-conscious fashion is on the rise. Green bonds bridge that divide. “The green bond market is one of the financing mechanisms the industry is turning to. Since 2020, 113 data center green bonds and loans have been issued globally, totaling roughly $61.3 billion,” noted Sunny Bokhari of VanEck.A Good Time to Consider GRNBGRNB turned nine years old in March and is the first ETF dedicated to green bonds. The $185.66 million ETF carries a 30-day SEC yield of 5.08%, confirming an impressive level of income, and an effective duration of 4.42 years, indicating it’s not highly sensitive to changes in interest rates. Those are alluring traits in today’s volatile bond market. GRNB is also, arguably, one of the more relevant fixed income ETFs tapping the theme. “Data center operators are increasingly turning to green bond issuance to address this problem,” added Bokhari. “Proceeds are typically earmarked for using renewable energy to power the data centers, energy-efficient cooling systems, and low-carbon construction. These investments can meaningfully reduce the emissions footprint of AI infrastructure. Issuers must also report on how proceeds were deployed and what environmental outcomes were achieved, creating a layer of accountability that distinguishes green bonds from conventional financing.” As the data cited in the fourth paragraph indicated, the marriage of green bonds and data centers isn’t a pipedream. It’s a reality with momentum. That could bode well for GRNB’s long-term prospects. “The data center green financing market has grown substantially since 2020, with 113 Climate Bonds Initiative (CBI)-aligned bonds and loans issued totaling roughly $61.3 billion,” concluded Bokhari. “Data center green financing was a niche corner of the market through 2023, with deal counts running in the single digits annually. However, in recent years AI infrastructure investment drove growth in total (conventional and green) data center debt issuance to $182 billion in 2025, nearly double the prior year.” For more news, information, and analysis, visit the Fixed Income Content Hub.

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