💸🔦This week’s corporate carbon dioxide removal (#CDR) buyer spotlight: Microsoft 💸🔦

In a new weekly series, I will be featuring the leading buyers of CDR. Every week, I’ll be looking at one company’s purchasing strategy and what their investments mean for the voluntary carbon market (#VCM). Today, we start with arguably the global leader: Microsoft. In 2021, Microsoft created a $1b over four years Climate Innovation Fund, of which $471m was set to be used to remove a cumulative 2.5Mt of CO2.

What is Microsoft’s climate commitment?

🎯Microsoft aims to become carbon negative by 2030 and remove all its historical carbon emissions since its founding by 2050 by reducing its #CO2 emissions across its entire supply chain.

💥The company purchased 1.4Mt of CDR in their fiscal year 2021, an additional 1.49Mt in 2022, and announced a 2.76Mt deal in 2023 with Danish energy company Orsted, for a staggering total of 5.65Mt of CDR to date.

What is Microsoft’s CDR buyer strategy?

🌱Microsoft is employing a portfolio approach starting off with largely nature based solutions (#NBS).

🔍The company is now increasingly focusing on medium and long-durability CDR like direct air capture (#DAC), bioenergy with carbon capture and storage (#BECCS), and various biochar carbon removal (#BCR) projects.

💵The weighted average price of Microsoft's 2022 portfolio is $19.40/metric tonnes of CO2. Note: this is prior to the recent Orsted deal (see below).

What does this mean for the CDR market?

✔️Microsoft’s portfolio approach investing in carbon credits of varying durability is a good example for other corporate buyers to follow.

✅ Microsoft works with other CDR industry leaders to reach its climate goals, including Carbonfuture (with Pacific Biochar), CarbonCapture Inc., and Running Tide. These relationships mark significant progress for the CDR industry, as they help catalyze the growth of the #CDR industry.

🗓Just last week, Microsoft signed a landmark long-term agreement with Ørsted to purchase 2.76Mt of high-quality carbon removal over 11 years, the largest single purchase of industrial CDR to date.

Microsoft’s CDR commitment highlights the essential role that large corporations play in growing the carbon removal industry and taking necessary action against the climate crisis. I, for one, am excited and inspired to see corporate responsibility take shape in the form of CDR commitments - stretching all the way to historical emissions - and I’m hopeful that CDR marketplaces like Carbonfuture will become fruitful resources for companies to mitigate their climate impacts.

What do you think about Microsoft’s CDR buyer commitments? What other CDR buyers would you like to see in this series?

Shoutout to Melanie Nakagawa, Katie Sierks, Annie Guo, Catherine Martini, Rafael Broze, and the rest of the Microsoft Carbon Removal team for leading Microsoft’s CDR journey.