Dependent: Upstream logistics decarbonisation via GLEC Framework and mode shift from air to ocean Scope 3 Cat 4 (upstream transportation and distribution) was 305,000 tCO2e in FY23, up from 243,000 tCO2e at the FY20 base. As of FY23, Microsoft adopts the GLEC Framework for its Devices and Cloud business groups to improve accuracy. In addition, Microsoft implemented a mode-shift initiative from air to ocean freight, delivering an estimated 95,000 tCO2e annual savings. SAFc are also applied to air cargo emissions (Cat 4). 97% of Cat 4 emissions are calculated using supplier data.
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Primary: Low-carbon concrete and embodied carbon in datacenter construction To address Cat 2 (capital goods, 38.24% of total emissions), Microsoft pilots net-negative embodied carbon limestone-alternative concrete derived from algae cultivation, achieving ~65% embodied carbon reduction vs conventional. 37 datacenters meet LEED Gold globally. New construction standards prohibit combustion for daily use in new offices and require high-efficiency electric kitchens/HVAC, non-fossil backup power. Using Building Transparency's EC3 tool, shifted to process-based methodology with third-party verified data for tracking embodied carbon.
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Primary: Cloud hardware circularity — 89.4% server reuse/recycle Reuse and recycle rates for servers and components reached 89.4% in FY23 (target 90% by 2025). Six Circular Centers operational (Amsterdam, Dublin, Boydton, Singapore, plus new Quincy and Chicago in 2023); two more planned for England/Australia. Developed patent-pending IDARS (Intelligent Disposition and Routing System) using Dynamics 365 to optimize disposition path for every cloud hardware part. Microsoft servers found to be 86% recyclable vs 67% industry average. New Sustainable Rack Packaging system estimated to divert 100,000 metric tons of waste from landfill.
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Landmark BECCS agreement with Orsted Long-term agreement with Orsted for bioenergy with carbon capture and storage (BECCS), adding carbon capture to existing heat and power plant. Also signed long-term offtake with Mombak for Amazon reforestation removal.
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Land protection target exceeded by 40% As of FY23, 15,849 acres designated as permanently protected vs goal of 11,000 acres by 2025. Added 3,579 acres in US in 2023 plus 12,270 acres in Belize previously.
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Dependent: Supplier engagement — 76.5% of emissions from suppliers 76.5% of FY23 emissions originated from suppliers. Microsoft piloted ESG value chain solution in Sustainability Manager to collect granular supplier emissions. Partnered with 3Degrees to launch Supplier REach portal helping smaller suppliers procure carbon-free electricity. 59 suppliers transitioned to renewable energy in FY23 (six to 100%), contributing 105,000 mtCO2e avoidance. New requirement announced: select scale, high-volume suppliers must use 100% carbon-free electricity for Microsoft-delivered goods and services by 2030. 99.4% of suppliers responded to CDP climate change questionnaire in 2023.
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Primary: Device circularity, repairability and energy efficiency Single-use plastic in product packaging reduced from 5.7% (FY20) to 2.7% (FY23); packaging recyclability at 93.9% (target 100% by 2030); post-consumer recycled content in device packaging at 53.8%. Surface Thunderbolt 4 Dock uses 20% ocean-bound plastic. Expanded repairable Surface portfolio (Go 4, Laptop Studio 2, Laptop Go 3). Xbox is first carbon-aware gaming console — schedules updates when grid carbon intensity is low; Shutdown mode cuts power 20x vs Sleep. Surface Laptop Studio 2 uses 65% less energy than ENERGY STAR limit.
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100% renewable electricity via long-term PPAs, vPPAs, EACs, and on-site solar across 21+ countries Microsoft sources 100% of its electricity from renewable sources globally, achieved and maintained in FY23. The primary mechanism is long-term power purchase agreements (PPAs and virtual PPAs) that Microsoft views as driving new, additional renewable capacity — with a contracted portfolio exceeding 19.8 GW across 21 countries as of 2023. These are supplemented by unbundled energy attribute certificates (RECs, GOs, REGOs, I-RECs, LGCs, J-Credits, NFCs, TIGR, GEC, NZECS) in markets where direct PPAs are not yet feasible. Microsoft is targeting carbon-free PPAs to cover 100% of carbon-emitting electricity consumed by datacenters, buildings and campuses by 2025. The firm is a RE100 signatory and this target (Low1) is part of its SBTi commitment. In FY23, 22,676,208 MWh (94.5% of total energy) was from renewable sources, with 3,341 MWh from on-site solar generation.
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5M tCO2e contracted in FY23 across DAC, BECCS, reforestation, ERW In FY23, Microsoft contracted 5,015,019 metric tons of carbon removal to be retired over next 15 years, retiring 605,354 tCO2e in-year. Building a balanced portfolio across low, medium, and high durability solutions. Key 2023 deals: Mombak (Amazon reforestation), Orsted (BECCS in Europe — adding carbon capture to existing heat/power plant with geological storage), Heirloom (direct air capture from limestone, up to 315K tons over multi-year), and novel pathways with UNDO and Lithos for enhanced rock weathering. Target is to remove more carbon than emitted by 2030 and remove all historical operational emissions by 2050. Contracts signed as of Dec 2023 will provide ~875,000 tCO2e toward the 2030 goal of >5M tons/year.
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19.8 GW contracted renewable energy portfolio across 21 countries Microsoft is among the world's largest corporate renewable energy purchasers. In 2023, Microsoft increased its contracted renewable energy portfolio to over 19.8 GW across 21 countries, signing new PPAs with AES (Brazil 154 MW), Constellation Energy (Virginia), Powerex (Washington — first commercial entity to use 24x7 Clean Load Service matching hourly datacenter demand with carbon-free hydro/solar/wind), Contact Energy (NZ), and Lightsource bp (Poland). Target is 100/100/0: 100% of electricity consumption matched by zero-carbon energy purchases 100% of the time by 2030, with 100% renewable energy by 2025. Total renewable electricity use in FY23 was 23.6 million MWh. Also signed agreement with Helion for first fusion power plant (50 MW+) targeted by 2028.
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