The climate is changing and calls to do something about it are intensifying. From the U.N. High-level Political Forum taking place this week in New York City to COP26 – the U.N.’s annual climate change conference in November – leaders are coming together to make decisions that will dictate the speed and scale of the global effort to stabilize our climate system.
At Microsoft we are not only tracking these conversations closely but also engaging in them – and we are, in a way, mirroring them. In this blog we outline what will be the most critical infrastructure of a net zero carbon economy, commit to new goals intended to help engineer that infrastructure, highlight a major new product offering intended to assist customers around the world to record, report and reduce their own emissions; and provide an update on progress toward our commitments to become carbon negative, water positive and zero waste by 2030 and protecting ecosystems by building a Planetary Computer.
Microsoft’s 100/100/0 vision and commitment for a decarbonized grid
Every net zero scenario that scientists and politicians play out shares a common, and essential, element: a massive increase in electrification. Powering vehicles and manufacturing plants with electricity holds the promise of wiping out vast sections of the global emissions portfolio. But this only happens if the electrons supplying the electricity are generated from zero carbon energy sources (wind, solar, hydro, nuclear, or point-source carbon capture and sequestration) and then stored and transported to where they are needed. Unfortunately, this is not the way the world’s grids are set up. Most electrons flowing onto grids today come from carbon intensive sources. Energy storage is extremely immature, and the grid infrastructure of today cannot efficiently respond to the varying production capabilities that zero carbon sources provide, nor the increasing consumption demands of a rapidly electrifying society.
By 2030 Microsoft will have 100 percent of its electricity consumption, 100 percent of the time, matched by zero carbon energy purchases.
At Microsoft we have a long-term vision that we refer to as 100/100/0 – that on all the world’s grids, 100 percent of electrons, 100 percent of the time, are generated from zero carbon sources. We call this a vision because we alone can’t control the outcome. Like other users, our datacenters and our offices around the world simply plug into the local grid, consuming energy from a vast pool of electrons generated from near and far, from a wide variety of sources. So while we can’t control how our energy is made, we can influence the way that we purchase our energy.
That is why today Microsoft is announcing its own 100/100/0 commitment – one that acknowledges the limits on our ability to control global grid infrastructure, but which maximizes our influence on it. By 2030 Microsoft will have 100 percent of our electricity consumption, 100 percent of the time, matched by zero carbon energy purchases.
Our influence is already significant in one dimension. Our existing commitment to execute power purchase agreements equivalent to 100% of our energy needs by 2025 has positioned Microsoft as one of the largest purchasers of renewable energy in the world. Over the last 12 months, Microsoft has signed new purchase agreements for approximately 5.8 gigawatts of renewable energy across 10 countries around the globe. This includes over 35 individual deals, including over 15 in Europe spanning Denmark, Sweden, Spain, U.K. and Ireland. This procurement brings our operating and contracted renewable energy projects to 7.8 gigawatts globally.
But we know we can do more. How much zero carbon energy we procure is important in helping decarbonize the grid, but so too is where, when and from whom we make our purchases. Moving forward we will be innovating our energy purchasing contracting to help bring more zero carbon energy onto the grid and move more high carbon intensity energy off the grid, helping to rebalance the carbon intensity of any grid on which we operate. We will match our purchasing of zero carbon energy with our consumption on an hourly basis. And we will do so on the same grid systems into which we are already connected.
This commitment will build upon the work we already have underway:
- Temporal matching: A recent white paper authored by RMI, in partnership with Microsoft, highlights the potential for hourly energy monitoring tools to provide transparency into supply and demand for zero carbon energy. The paper illustrates that hourly renewable supply and demand matching strategies can help lay the groundwork for a decarbonized grid. Last November, we announced the availability of the first commercial 24/7 hourly energy-matching solution with our partner Vattenfall, which we will use to monitor energy use and zero carbon energy matching for our Swedish datacenters. Building on this work, we’re announcing a new 24/7 pilot in the Netherlands with energy provider Eneco and FlexiDAO, a technology supplier, which will match one of our Amsterdam datacenter’s hourly energy consumption with Dutch offshore windfarm Borssele. Microsoft will be a flagship customer of FlexiDAO’s 24/7 solution, which will enable Eneco customers including Microsoft to have access to FlexiDAO’s 24/7 renewable energy-matching tools at scale.
- Spatial matching: We’re enabling more granular measurement with data called Locational Marginal Emissions (LMEs), which considers the condition of the power grid at the time and location that the clean energy was produced. We partnered with REsurety to create an LME tool on Azure that calculates the decarbonization impact of our renewable energy supply with greater accuracy, beginning first with a pilot in the Electric Reliability Council of Texas.
- Purchasing partnerships: Working with energy suppliers across the globe, we were able to execute over 35 power purchase agreements:
- With Volt Energy, a national African American owned solar development company, we have contracted a 250 megawatt portfolio of solar projects, the intent of which is to create new opportunities for under-resourced communities and to help pursue diversity in the renewable energy industry.
- We progressed our partnership with bp to create renewable energy deal structures that incorporate multiple renewable energy pipelines in multiple global regions that will deliver clean energy that more closely aligns with our datacenter electricity demand.
- Invenergy, a leading global developer and operator of sustainable energy solutions, provided more than 1,000 megawatts of new renewable energy agreements across the U.S. and Europe.
- AEP Energy, with their expertise in the PJM energy market, will provide renewable energy to Microsoft from a portfolio of up to 560 megawatts of new renewable energy assets.
- Our clean energy partnership with Shell continues to grow by progressing more than 300 megawatts of renewable energy contracts in the EU.
We know that our actions alone won’t decarbonize the grid, but we are committed to doing our part to help drive important market demand signals that influence the speed and scale at which the grid decarbonizes.
Enabling our customers and partners
The grid is not the only infrastructure that Microsoft can help decarbonize. Through new digital tools we can also assist our customers in decarbonizing their own operations and infrastructure. This was the motivation behind our announcement of a new Microsoft solution – the Microsoft Cloud for Sustainability – that will enable our customers around the world to record, report and reduce their emissions on their paths to net zero.
Progress on our commitments
As part of our commitment to be carbon negative by 2030, water positive by 2030, zero waste by 2030 and to protect ecosystems by developing a Planetary Computer, we have:
Impact Observatory developed the Global Land Map with technology and funding from Microsoft AI for Earth and Esri. Photo credit: Impact Observatory
Investing for the future
Through our $1 billion Climate Innovation Fund, we’ve made direct investments in several companies to help them accelerate and scale their solutions, including:
- NCX, formerly SilviaTerra, to help fund the creation of the largest forest carbon project by acreage in the continental United States and help make carbon market participation more accessible to landowners of all sizes.
- Twelve, formerly Opus12, to help scale the reduction of emissions from supply chains and essential products across a range of industries. across a range of industries.
- Rheaply, to fund the development of carbon-related Rheaply feature updates to help companies measure carbon emissions savings from reuse and fuel the circular economy.
Shaping a more sustainable supply chain
To help aid reporting requirements in our Supplier Code of Conduct, today we are releasing a set of in-depth capacity-building tools and resources, developed in partnership with Engie, WSP and CDP to help companies, and particularly our suppliers, report their greenhouse gas (GHG) emissions, develop clean energy strategies and reduce their energy-related emissions. We’re also partnering with the International Finance Corporation, a sister organization to the World Bank, which will work with designated Microsoft suppliers in emerging markets, starting in Asia, to identify technical solutions reducing GHG emissions, provide implementation assistance and offer financing solutions to help them make investments in more efficient and low-carbon operations.
Microsoft is a Principal Partner of COP26.
Using our voice in policy
We frequently use our voice on climate-related public policy issues and in supporting new public policy initiatives to accelerate carbon, water, waste and ecosystems opportunities:
- Recently, we shared comments to the U.S. Securities and Exchange Commission on the topic of climate change disclosure centered on the need for common standards of climate measurement across the U.S. government and the world.
- In Europe today, we welcomed the Commission’s Fit for 55 Package to reduce emissions by at least 55% by 2030 and achieve a climate-neutral Europe by 2050.
- Looking ahead to COP26 this fall, we have a real opportunity to come together to commit to a net zero carbon economy and share learnings on our individual and collective journey to reduce carbon emissions. It’s an important moment in the global climate conversation and we will need to make significant progress in three core areas: the meaning of net zero, the measurement of net zero and the markets that will support net zero.
Building sustainably
We’re also making progress through innovative work in campus development. Recently, we:
- Received Zero Carbon certifications for our Puget Sound and Silicon Valley campuses, demonstrating that zero carbon designs are achievable today. We are pursuing Zero Carbon Certification from the International Living Future Institute.
- Unveiled our Redmond, Washington campus Thermal Energy Center, a state-of-the-art, all electric central utility system which leverages vast geothermal wells to use the deep earth’s constant temperature to efficiently heat and cool campus via zero carbon electricity.
Microsoft’s new Redmond, Washington campus will be all electric, zero carbon certified, and powered with 100% renewable energy, aided by a Thermal Energy Center. - Created a white paper on how to reduce embodied carbon through the selection and procurement of low-carbon products and the tracking and reduction of carbon emissions during construction.
While much has been done in the first half of this year, it’s clear that there is still much more work to do, and we’ll continue to be transparent about our progress and learnings. After all, it’s not enough for Microsoft to meet its commitments — we need other organizations and governments working together to achieve a net zero carbon economy by 2050. We look forward to continuing these important conversations, centered on action — at Inspire this week, as part of the Transform to Net Zero initiative, at COP26 this fall and beyond.
*For organizations that are interested in learning more about the state of the carbon removal market today and Microsoft’s experience procuring carbon removal, we will be sponsoring a complementary summit in partnership with GreenBiz VERGE Net Zero on July 28.
