Microsoft to buy 3.6 million carbon credits from Louisiana biofuel plant

Microsoft revealed on Thursday that it would buy 3.6 million carbon removal credits from a C2X-owned biofuel plant in Louisiana.

The upcoming plant, scheduled to commence operations in 2029, will transform forestry waste into methanol, a versatile substance that can fuel ships and planes, as well as serve as a key ingredient in chemical manufacturing.

This state-of-the-art facility is set to generate over 500,000 metric tons of high-quality methanol annually. In a significant environmental achievement, it will also capture and securely store approximately 1 million metric tons of carbon dioxide. This will likely occur in underground reservoirs.

The acquisition is one of many that Microsoft has made in the last year or so. These include a 4.9 million metric ton deal with Vaulted Deep, a 3.7 million metric ton agreement with CO280, and a 7 million metric ton purchase from Chestnut Carbon.

Microsoft’s rapid expansion of its data center footprint risks its 2030 pledge. The company aims to remove more carbon from the atmosphere than it emits.

The push for these deals is largely driven by the boom in artificial intelligence (AI). Running powerful AI models requires massive amounts of electricity. This makes it much harder for tech giants to cut emissions as quickly as they planned.

Although the technology company already procures significant volumes of renewable and nuclear energy, these carbon removal purchases are intended to counteract forthcoming fossil fuel emissions.