Microsoft’s greenhouse gas emissions increased by about 25 percent last year, the company says in its new sustainability report released Thursday.
The report follows similar ones released by Google and Amazon last week. Together, they show a troubling trend of increased production by technology companies, driven by a global race to build. power hungry data centers.
In a blog post announcing the report, Microsoft vice chairman and president Brad Smith and chief sustainability officer Melanie Nakagawa say that the increase in emissions is driven “primarily by the expansion of our data center infrastructure.”
Much of that increase, they write, was linked to the energy output the company bought or acquired to run its operations. Known as Scope 2 emissions, that greenhouse gas emissions accounted for 13 percent of Microsoft’s total.
Data centers, which consume large amounts of energy that power artificial intelligence chips, have pushed the goals of many technology companies further out of reach in the past few years.
Amazon revealed a 16 percent increase in CO2 production in its most recent sustainability report. Google he said in its new sustainability report that annual greenhouse gas emissions increased by 18 percent last year compared to 2024, a significant increase in one year has been recorded. The company has invested heavily in renewable energy, but has also begun to scale up fuel energy for some of its data centers.
Microsoft highlighted in its sustainability report that it had matched 100 percent of its electricity use with carbon-free sources. But data center construction is set to accelerate—and some of Microsoft’s recent investments could increase its production. Specifically, the new report covers fiscal year 2025, which ended last June, and has made several deals since then involving gas-powered data centers.
Last month, the company officially announced a partnership with Chevron, which is building a power plant to supply the company’s future data center in West Texas. The permits show that the power plant can emit more than 11.5 million tons of CO2 equivalent each year, an amount larger than the entire state of Rhode Island. The company has also leased buildings on the Stargate campus in Abilene, Texas, which will be powered by an existing power plant that can emit more than 7.8 million tons of CO.2 the same every year. Microsoft has also signed a non-binding letter of intent to compute at a West Virginia data center, which will be powered by off-grid gas that can emits more than 11 million tons of greenhouse gases.
“Microsoft’s strategy includes exploring various options to reduce emissions from its electricity use, consistent with our sustainability aspirations,” Nakagawa says in a statement to WIRED.
Microsoft’s approach to offset some of its debt through loans and other investments is also changing. The company says it stopped buying non-bundled renewable energy certificates, a move that contributed in part to the increase in Scope 2 emissions. Using these types of certificates have been criticized in recent years like greenwashing because you don’t have to add more clean power to the grid. Unbundled RECs are essentially “paper activities that are physically separated from real-world outcomes,” says Danny Cullenward, a researcher at the University of Pennsylvania. (Cullenward is also a visiting faculty member at Google but notes that he was not speaking on behalf of the company.)
“I think it’s very commendable that (Microsoft) is moving away from unbundled RECs and prioritizing investments in new clean electricity, where power purchase agreements and other long-term cut-off agreements can lead to new clean electricity coming online,” he adds.
Despite increased production and its continued investment in AI, Microsoft still says it plans to be “carbon negative” by 2030. Smith and Nakagawa write that the global AI race is “increasing demand for … energy, water, land, and materials.” They say that the company “has a responsibility to help ensure that technology strengthens, rather than disrupts, the systems and communities that depend on it.”
