AI-Powered Expansions Lead to an Increase in Microsoft’s Carbon Footprint

Microsoft’s Thermal Energy Center located at their headquarters in Redmond, Washington. The center utilizes geothermal energy from beneath the Earth’s surface to generate clean power. (Microsoft Photo)

In the year 2020, Microsoft announced its ambitious goal to become carbon negative in ten years, aiming to remove more carbon from the atmosphere than it emits annually.

However, four years into the commitment, the software, cloud services, and gaming behemoth’s carbon footprint has only grown.

Based on Microsoft’s own 2024 Environmental Sustainability Report, which covers the fiscal year of 2023 and was released this Wednesday, the company’s greenhouse gas emissions have risen by 29% to 40% compared to when Satya Nadella, the CEO, made the pledge.

The surge in artificial intelligence and generative AI technologies like ChatGPT places even greater pressure on Microsoft’s environmental goals, increasing the demand for data centers, which are major consumers of energy and are constructed from materials like steel and concrete, known for their high carbon footprint. In just the first quarter of this year, Microsoft’s spending on capital expenditures soared to a new high of $14 billion.

Despite these concerning trends in carbon emissions, Microsoft’s leadership maintains their commitment to the set goals.

Speaking to GeekWire, Melanie Nakagawa, Microsoft’s chief sustainability officer, highlighted that while challenges remain, progress is being made in reducing some sources of emissions. The company is also investing in climate tech companies and initiatives aimed at diminishing their carbon impact over time.

“Setting these goals in 2020 was our moonshot,” Nakagawa expressed. “We’re unwavering in our determination to achieve them. With six years left, we’re optimistic about the ongoing and forthcoming innovations that will help us reach our target by 2030.”

Microsoft’s so-called scope 3 emissions, which make up over 96% of its carbon footprint, are primarily driven by purchased goods and services from external providers and capital projects. (Microsoft 2024 Environmental Sustainability Report Image)

Last year, Microsoft’s emissions amounted to over 15.4 million metric tons of carbon dioxide equivalent, according to the lower end of its calculations. This figure is roughly fivefold the annual emissions of Seattle.

While its carbon impact was expanding, the company reported a net income of $72.4 billion for its fiscal year 2023, marking a 6% increase from the prior year.

To reduce emissions, Microsoft has implemented:

  • Over 80 new strategies to cut carbon emissions resulting from construction, purchased goods, and employee travel.
  • A new policy requiring that by 2030, all suppliers use 100% carbon-free electricity for goods and services supplied to Microsoft.
  • A recent agreement to acquire 10.5 gigawatts of renewable power, adding to the 19.8 gigawatts of clean energy already in its collection.
  • The purchase of more than 5 million metric tons of carbon removal in 2023.
  • Ongoing investment in startups through its $1 billion Climate Innovation Fund, focusing on low-carbon products, including greener steel and concrete, and sustainable aviation fuel.

Microsoft is also taking measures to enhance clean water supplies, eliminate waste, and preserve biodiversity on the planet.

The report also acknowledges a 87% increase in water consumption since 2020, reaching nearly 2.1 billion gallons in the previous year, mainly to cool data center computers. To counterbalance this, Microsoft has invested in projects aimed at replenishing more than three times the amount of water it uses globally.

Specific instances of Microsoft’s water usage have sparked concerns, such as the construction of a data center in an arid Arizona town expected to use 56 million gallons of water annually. The company, in its report, commits to designing future data centers to operate without using potable water for cooling, utilizing alternative strategies like rainwater capture and reclaimed water use.

In its pursuit to reduce waste, Microsoft has achieved a recycling and reuse rate of 89.4% for cloud computing servers and other components.

To support its commitment to protecting natural habitats, the company has safeguarded 15,849 acres of land.

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