Microsoft has adopted more than 80 measures to combat a 29.1% increase in greenhouse gas emissions since 2020, primarily due to new data centers.
The company's Scope 1 and 2 emissions (emissions closely related to the company's operations, manufacturing, and electricity use) decreased by 6.3% from the 2020 baseline. However, Scope 3 production (indirect emissions from customer purchases and other supply chain categories) increased by 30.9% over the same period.
The company's emissions increased by 3.8% in fiscal 2023 compared to the previous year. This is the third consecutive increase since the world's largest software company announced his 2020 goals. “Carbon negative” by 2030Microsoft announced on May 15th, 2023 Environmental Sustainability Report. With this goal, Microsoft commits to neutralizing its carbon, water consumption, waste generation, and land use impacts by the end of the decade.
Microsoft reported 17,162,000 metric tons of carbon dioxide equivalent for the year ending June 30, 2023. In comparison, in fiscal year 2022, he was 16,538,000 tons. As has been the case for the past three yearsall of that increase is due to scope 3.
Weight of concrete, steel and IT equipment
Microsoft executives believe the increase is primarily due to new data centers.
„Our challenges are unique to our position as a major cloud provider that is expanding its data centers,“ Microsoft President and Vice Chairman Brad Smith and Microsoft CSO Melanie Nakagawa said on May 15. This was stated in the preface of the environmental report published in . But more than that, we reflect the challenges the world must overcome to develop and use greener concrete, steel, fuels and chips. These are the biggest drivers of our Scope 3 agenda. ”
Microsoft's rivals Amazon and Google won't release their next environmental progress reports until July. Both companies have made methodological updates that have impacted the previous report, making accurate comparisons difficult, but are fueled by demand for artificial intelligence services as a growing challenge to energy, waste and water targets. It also points out the construction of data centers. Google would not have reported changes in scope 3 emissions For fiscal year 2022, assuming no methodological changes. Amazon reported a 0.7% decrease in Scope 3citing its ability to reduce construction emissions.
Microsoft's Scope 3 accounts for approximately 96% of its total emissions. Three-quarters of this is related to purchased products, Nakagawa said in an interview with GreenBiz. „I think it's important to emphasize: We are very aware of what our challenges and opportunities are,“ she said. “We have embarked on a journey and effort to understand the scale of the challenge before us and what the opportunities are to move down the emissions curve across our suppliers and value chains.”
Nakagawa said the company has launched a company-wide effort to reverse this trend. The strategy includes more than 80 „individual and significant measures“, including a new requirement for its most frequently traded „high-volume“ suppliers to use carbon-free energy by 2030. Previously, absolute reductions were mandatory. Reduce emissions by at least 55% by that time.
Microsoft adopted stricter emissions disclosures by certain suppliers in summer 2023.. (Amazon has adopted similar measures.) Emissions data is also part of Microsoft's sourcing standards. Heads of each department are charged an internal fee for emissions, including supplier emissions. “The more informed decisions we can make towards lower carbon, the more we will benefit in terms of impact on rates on an annual basis,” Nakagawa said.
80 initiatives are microsoft climate council. The group is chaired by Smith and includes Nakagawa and business leaders from across the company. The priorities are:
- Leverage digital technologies including artificial intelligence, gather insights and automate the management of power and water consumption. For example, Microsoft has invested in LineVision, which develops software to free up capacity on the power grid.
- Increase data center water usage efficiency. The company's massive new data center in WisconsinFor example, it is cooled by a closed-loop water recycling system that uses fresh water only in rare circumstances.
- Innovate through partnerships,like that Partnered with RMI in September 2023to develop green steel supplies.
- Leverage that purchasing power for new solutions, low carbon computer servers, steel, electrical and concrete. In April, for example, Microsoft put more money into LanzaJet, which makes sustainable aviation fuel. $1 billion climate innovation fund.
- advocate for public policy changeas indicated by the decision to participate in 2023. water recycling federation.
Helps remove carbon dioxide
Microsoft is also making significant investments in new approaches to carbon removal. In fiscal year 2023, he signed contracts for over 5 million tons of credits related to future projects. 15-year agreement with Chestnut Carbon for US-based reforestation project.
This is more than five times the carbon removal offsets Microsoft purchased in fiscal year 2022. It is possible that this amount will be matched within this fiscal year. Microsoft signed its largest carbon removal contract to date in early May With Exergi from Stockholm. This targets the removal of 3.33 million tons of carbon over 10 years from 2028.
For accounting purposes, carbon offsets are discarded as they are generated. In his fiscal year 2023, Microsoft will eliminate offsets related to approximately 605,000 tons of CO2 equivalent, which will allow the company to claim to be carbon neutral.