What Microsoft learned from purchasing millions of carbon removal credits

Microsoft has bought far more carbon removal credits than any other company, recently contracting for just over 6 million from four projects covering forests, farmland, and industrial carbon capture. The company shared what it has learned in managing these deals, since carbon removal credits are meant to offset emissions by paying for projects that pull carbon out of the air or keep it from being released.

One lesson involves how projects calculate their climate benefit. Some past carbon-credit scandals came from projects assuming an unrealistically low baseline for what would have happened without the project, which let them claim more credit than they earned. Microsoft's newer projects use "dynamic baselines" that get updated over time based on real monitoring, and rely on tools like soil sampling and drone surveys to confirm the carbon benefit is real rather than just claimed on paper.

The company also flagged a risk with projects that burn plant material, like a power plant near Copenhagen it is working with, since a shift to less sustainable fuel sourcing could undo the climate benefit. Microsoft says the project follows sourcing rules it helped develop with an outside firm.

None of this directly changes anything for homeowners, since it involves a large company's corporate carbon accounting rather than home energy programs. But it is a reminder that not all carbon credits are equal, and that verifying real-world results is a live challenge in this market. Separately, Microsoft's own emissions rose 25 percent last year as it built new data centers for AI, and it has not yet said whether it will need to buy even more credits to meet its 2030 goal of removing more carbon than it emits.