Microsoft says data center construction increased its carbon emissions by 25% last year
The company said its carbon emissions rose by 25% in 2025, becoming the latest technology company to disclose that it has encountered setbacks in reducing emissions while increasing investment in artificial intelligence data centers. Microsoft said in its annual sustainability report released on Thursday that the company would emit 20 million tons of carbon dioxide equivalent in 2025, up from 16 million tons the previous year. Microsoft said the increase was mainly driven by new data centers and its previously announced suspension of some renewable energy quota purchases. Microsoft President Brad Smith and Chief Sustainability Officer Melanie Nakagawa wrote in the report: "Artificial intelligence infrastructure has pushed up the demand for energy, water resources, land and various raw materials, but the expansion rate of sustainable development supporting solutions cannot keep up with the growth of demand. This contradiction between supply and demand exists objectively, and it also creates new development opportunities." The software giant pledged six years ago to remove more carbon from the atmosphere by 2030 than it emits. At that time, data center energy efficiency continued to improve, and corporate investment in renewable energy and carbon sequestration technology increased significantly, making this goal feasible. However, the company's green development vision has a fierce conflict with its business development goals. Microsoft is determined to become an industry giant in the era of artificial intelligence, which has set off a boom in building new high-energy-consuming data centers to support the operation of various AI models. This move not only increases the load on the power grid, but also forces power companies to build new fossil fuel power plants. For example, in June this year, the company The company signed an agreement to obtain electricity from a large natural gas power plant planned for construction in West Texas and use it to power a new data center complex. At the same time, the company has reassessed its emissions reduction efforts and told sustainability partners it will scale back new carbon bank transactions. Executives are also considering delaying a goal that would see Microsoft match hourly electricity use in its data centers with renewable energy. As the U.S. government relaxes environmental standards and attempts to curb sustainability initiatives, other companies are withdrawing their commitments. Microsoft said its carbon emissions would have been lower had it not been for last year's decision to suspend the purchase of Category 1 carbon credits. This type of carbon credit is controversial in the environmental field because it cannot directly incentivize new zero-carbon energy projects. Smith and Nakagawa said that the company hopes to formulate a more precise definition of the standards required for sustainable development, and as the environmental situation changes, relevant data continues to improve, and the trade-offs gradually become clear, it will more proactively optimize and adjust its development strategy. "This in no way means that we have lowered our environmental goals and vision."