Today, Microsoft published its 2025 Environmental Sustainability Report. This report covers our fiscal year 2024, and measures progress against our 2020 baseline. You can read the foreword below and explore the report in its entirety here.
As Microsoft continues to grow and innovate, our commitment to environmental sustainability remains a core value. This year, we reflect on our progress towards our ambitious 2030 goals: to be carbon negative, water positive, and zero waste, while protecting ecosystems. As we enter the second half of the decade, Microsoft remains steadfast in our dedication to achieving the company’s 2030 environmental sustainability commitments.
Since we announced our goals in 2020, we have made meaningful progress while seeing major changes in both the technology sector and in our understanding of what it will take to meet our goals. We are learning as we go, and we are proactively working to address sustainability challenges and accelerate solutions. We remain resolute in our commitment not only to meeting our climate goals but also to empowering others with the technology they need to build a more sustainable future.
At the heart of our approach is an understanding that sustainability is not simply a set of isolated initiatives, but a fundamental principle that must be integrated into every aspect of our business. Our cross-company Climate Council brings together leaders from across Microsoft to drive innovation, accelerate progress, and identify ways to build sustainability into our operations, products, and partnerships.
We remain pragmatically optimistic because of the promise of new sustainability technologies, innovations in AI, and market solutions that are emerging which can accelerate progress across challenging sectors like steel, concrete, and energy transitions. This annual report is our opportunity to share our learnings to help accelerate these markets, be transparent about our progress, and explore how we can ultimately scale solutions across our value chain.
We are sharing details about the progress made in each of our core commitment areas: carbon negative, water positive, zero waste, and protecting ecosystems. Our report also highlights a number of our breakthrough innovations, drawing insights from the leading edge of climate innovation.
Our progress
In 2020, Microsoft made bold sustainability commitments. At this halfway point to our 2030 goals, we are reaching key milestones and making progress that includes:
Ecosystems. In 2022, we met our target of protecting more land than we use by 2025, a target we’ve since exceeded by more than 30%. AI innovation is now driving biodiversity conservation through research efforts led by the AI for Good Lab and tools like the Microsoft Planetary Computer.
Zero waste. We exceeded our annual target to divert 75% of construction and demolition waste six years early by diverting 85% of this waste in FY24. We have also surpassed our target for our reuse and recycling rate for servers and components, reaching 90.9%. The Surface Copilot+ PCs now feature our most sustainable packaging design yet. Packaging from over 30,000 server racks was processed through recycling programs in FY24—diverting over 2,500 metric tons of waste from landfills.
Water positive. We met our target to provide more than 1.5 million people with clean water and sanitation solutions. We are also on track to replenish more water than we consume across global operations and improve datacenter water use efficiency, including through a new innovative datacenter design that optimizes AI workloads and consumes zero water for cooling to avoid the use of an estimated 125,000 cubic meters annually per facility.
Carbon negative. To date, we have contracted 34 gigawatts (GW) of carbon-free electricity (CFE) across 24 countries, about an eighteenfold increase since 2020. We have also entered long-term agreements to procure nearly 30 million metric tons of carbon removal since the start of this program.
Carbon negative: a marathon, not a sprint
As we remain focused on sustained progress towards our 2030 goals, it has become clear that our journey towards being carbon negative is a marathon, not a sprint. While our total emissions (Scope 1, 2, and 3) have increased by 23.4% compared to our 2020 baseline due to growth-related factors such as AI and cloud expansion, we are encouraged by the fact that this increase has been modest compared to the 168% increase in energy use and 71% revenue growth that has taken place over the same period.
For Microsoft to be carbon negative by 2030, we will need to reduce our value chain emissions. Starting with our direct operational emissions, as we shared earlier this year, since 2012 our carbon strategy has included a combination of procuring environmental attributes leveraging our corporate carbon fee and overall carbon emissions reduction efforts. This enabled us to decrease our Scope 1 and 2 emissions by 29.9% from our 2020 baseline in FY24. At the same time, as we shift away from procuring non-additional environmental attribute certificates, we recognize that we must also bring more carbon-free electricity onto the grids where we operate.
We are also implementing strategies to reduce our Scope 3 emissions by 2030, which increased in FY24 by 26% from our 2020 baseline. We are prioritizing addressing these emissions through supplier engagement programs including establishing standards via our Supplier Code of Conduct. Through the latter, select large-scale Microsoft suppliers are required to transition to 100% carbon-free electricity for their delivered goods and services as well as forthcoming guidance, launching in July, to target usage of sustainable aviation fuel, where possible, for Microsoft business-related air travel by 2030. We also remain committed to developing and supporting innovative solutions to reduce emissions from key datacenter and operational inputs including building materials, chips, and fuels, focusing on long-term solutions over short-term stopgaps. To do this, we have been adapting our strategies to use new sustainability technologies and address the challenges of expanding energy demand.
We see significant progress in several key areas, demonstrating potential for global impact:
Powering operations with carbon-free electricity (CFE):
In 2024, Microsoft contracted 19 GW of new renewable energy across 16 countries through power purchase agreements (PPAs), which are central to our carbon reduction strategy, driving down our Scope 2 emissions. Microsoft has taken a first-mover approach to making long-term investments to bring more CFE online.
We continue to advocate for expanding clean energy solutions globally to support not only our power needs but also those of our supply chain. We are addressing challenges with permitting, interconnection delays, and fluctuating interest rates by innovating through circularity and contracting. For example, we signed groundbreaking PPAs with Engie requiring that 100% of photovoltaic modules will be reused or recycled.
Transforming datacenters and campuses:
In FY24, we launched our first datacenters constructed with mass timber, a strong, ultra-lightweight wood in a hybrid construction model. This approach is projected to reduce the embodied carbon footprint of these new datacenters by up to 65% compared to typical precast concrete. We also doubled our rate of power savings and are transitioning from traditional air-cooled datacenters to chip-level liquid cooling designs at all owned datacenters. As the World Economic Forum highlighted in Innovation and Adaptation in the Climate Crisis, “Data-driven and digital technologies are uniquely suited to build adaptive capacity.”
We believe technology can be a powerful tool to address some of society’s toughest challenges, including environmental sustainability. As demand for AI and cloud services grows, we are advancing how we design, build, and operate our datacenters and campuses. Decarbonizing the built environment is a crucial element in this process.
Accelerating carbon removal initiatives:
In FY24, Microsoft signed long-term agreements to procure more carbon removal than all previous years combined, achieving nearly 22 million metric tons in contracts for carbon removal. We are committed to helping build the markets we buy from, translating leading science into commercial innovation and regularly updating our Criteria for High-Quality Carbon Dioxide Removal. We also know we cannot accelerate this market alone, which is why we co-founded the Symbiosis Coalition with industry partners. The Symbiosis Coalition is targeting up to 20 million metric tons of high-quality, nature-based carbon removal credits by 2030.
Improving operational efficiency and logistics:
In FY24, among facilities that manufacture devices for Microsoft, we saw a tenfold increase over the previous year in transitions to 100% CFE. This was accomplished, in part, by partnering with 3Degrees to launch the Supplier REach portal to support suppliers making their CFE transition. Our drive to reduce datacenter emissions extends to transforming the logistics operations of these facilities.
Through strategic partnerships and targeted initiatives, Microsoft continues to reduce emissions across transportation, warehousing, and the broader logistics supply chain, setting new benchmarks for operational efficiency and environmental impact. We adopted alternative fuels and electric vehicles to reduce emissions, collaborating with several leading logistics service providers (LSPs).
Renewable diesel is now in use in our road freight operations in Europe and California, cutting emissions by 50% for these shipments while keeping existing equipment in use. We also have partnered with airlines and shipping lines to expand the use of sustainable aviation and marine fuels. These efforts have reduced emissions by over 17,000 metric tons of CO2 emissions, comparable to avoiding the combustion of nearly 40,000 barrels of oil.(1)
Accelerating global solutions
At Microsoft, we understand that driving meaningful sustainability progress goes beyond our own practices and requires global collaboration, investment, and innovation. Across our operations, we are working to empower customers, build impactful partnerships, and invest in breakthrough solutions that drive progress worldwide.
Investing in innovation: A hallmark of this effort has been our Climate Innovation Fund (CIF)—our $1 billion commitment set in 2020 to advance innovation beyond Microsoft’s four walls. To date, CIF has made significant investments in innovative climate technologies including commercial direct air capture technologies, sustainable aviation fuel, industrial decarbonization, and more. CIF has invested over $793 million in capital in new climate technologies, expanding to 63 investments across CFE, sustainable fuels, carbon removal, and advanced building materials.
Empowering customers: We help customers and organizations centralize, analyze, and act on their data with AI-powered platforms for advanced analytics and reporting insights. For example, the Howden Resilience Laboratory supported by Microsoft and our Planetary Computer uses technology and data platforms to help investors understand climate risks to critical infrastructure, improve resilience, and contribute to better-informed investment decisions.
Partnering for impact: Partnering to scale our impact is a critical component of our sustainability efforts. Today GitHub fosters a thriving community that is home to over 150 million developers and 60,000 climate-focused open-source projects, advancing climate technology, greener software, and device sustainability. Xbox has made significant investments not only to reduce the environmental footprint associated with the production of our devices, accessories, and console packaging, but also to reduce the energy usage of the console itself. For example, Xbox became the first console to release a dedicated energy consumption and carbon emissions measurement tool designed for game creators.
Accelerating AI for sustainability: Our AI for Good Lab, sustainability science, and research teams collaborate globally to accelerate solutions and develop climate resilience with AI. For example, we have partnered with the United Nations to apply AI to climate challenges through programs like the Early Warnings for All initiative, which seeks to better understand which populations may be at risk of extreme weather events and other threats. By sharing our progress, tools, and learnings with the world, we aim to accelerate the pace of innovation, improve overall operational efficiency, reduce energy consumption, and find new solutions with long-term results.
Sustained momentum and future impact
There is no issue today that connects everyone on the planet more than climate change. As we strive to build a more sustainable future, we remain inspired by the dedication of our employees and partners and committed to transparency, accountability, and collaboration.
While the road to a sustainable future is challenging and not linear, we are encouraged by the progress we have made in FY24. By strategically focusing on CFE, carbon removal, water stewardship, waste reduction, and ecosystem protection, we are building an efficient, sustainable engine that drives us closer to our commitments.
We encourage you to read further to learn more about our progress and learnings across all of these areas, and we look forward to engaging in continued dialogue as we learn and develop new ways to help us meet our goals. We will continue to adapt our strategies, utilize emerging sustainability markets, and scale innovative technologies for even greater impact.
We recognize that achieving our ambitious goals requires sustained momentum, and we are dedicated to driving that momentum forward.
(1) This estimate is calculated based on the EPA estimate of the typical passenger vehicle emitting 4.6 tons of carbon dioxide per year.
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