Sustainable Column | Is Microsoft greenwashing?

When it comes to sustainability, it's hard to tell who is moving towards green and who is just whitewashing.

"Microsoft needs to be accountable for its climate footprint and is committed to reducing emissions in its supply chain that currently relies on fossil fuels. We don't have time for hollow promises, vague net-zero commitments, and other greenwashing tricks. The record is clear - Microsoft has fallen behind in our critical decade of climate protection." A petition letter to Microsoft CEO Satya Nadella on the website of North American environmental organization Stand.earth reads.

This accusation may not necessarily come from green radicals. As an old-tech giant, Microsoft's performance in carbon reduction has indeed sparked controversy.

On one hand, Microsoft has an ambitious net-zero target, aiming to achieve 100% renewable energy by 2025, negative carbon emissions by 2030, and committing $1 billion to negative emission technologies - this ambitious net-zero plan has been well received.

However, on the other hand, Microsoft's real stance on the oil industry, purchasing carbon offsets to neutralize its carbon emissions, seems to make its commitments appear less credible.

Reluctance to Part with Oil

As of 2023 and 2024, Microsoft continues to maintain partnerships with oil and gas companies, especially in providing cloud computing and artificial intelligence (AI) services. Through the Azure platform, Microsoft provides these companies with a large amount of data processing and analysis capabilities to help them improve operational efficiency, manage emissions, and develop new low-carbon technologies.

For example, Shell uses Microsoft's AI technology and IoT to optimize the exploration, production, and transportation processes of oil and gas to improve efficiency and reduce costs.

Microsoft has also entered into a long-term strategic partnership with Chevron. Chevron utilizes Microsoft's Azure cloud computing platform and AI technology to manage and analyze large amounts of geological data to optimize the development and operation of its oil and gas fields.

Microsoft's collaboration with ExxonMobil also leverages Azure and AI technology to help ExxonMobil optimize its oil production in the Permian Basin in the United States. The goal of this project is to improve oil recovery efficiency through data analysis and machine learning.

BP also uses Microsoft's Azure platform to analyze and manage its global oil and gas assets. These collaborative projects demonstrate how Microsoft plays a key role as a technology partner in the energy industry, even under pressure to transition to sustainable energy sources.

This is also one of the reasons why Microsoft's environmental commitments have been criticized, as these partnerships may contradict the global goal of reducing fossil fuel dependence.

It's not just the controversy over whether tech platforms are promoting the use of fossil fuels, but Microsoft's own disclosed data reflects another aspect of its green challenge: the expansion of artificial intelligence itself.

Microsoft's carbon emissions data for the 2024 fiscal year shows a significant increase compared to 2023, mainly due to the rapid expansion of the company in the field of artificial intelligence, leading to a substantial increase in energy demand in data centers. Microsoft's total carbon emissions increased by nearly 30%, including Scope 1 (direct emissions), Scope 2 (indirect energy emissions), and Scope 3 (indirect emissions generated by the supply chain and product use)

Invalid Offset?

Some of Microsoft's environmental initiatives rely on purchasing carbon offsets to neutralize its carbon emissions. Critics argue that carbon offsets do not truly solve the problem of carbon emissions, and some projects may even have false or exaggerated effects, failing to achieve the real goal of reducing greenhouse gas emissions.

Microsoft announced that, with the assistance of climate solutions provider 3Degrees, it has purchased 80,000 tons of carbon removal from the Blue Creek Improved Forest Management Project managed by the Western Rivers Conservancy in Northern California.

The project is managed by the non-profit conservation organization Western Rivers Conservancy (WRC) based in Oregon, generating carbon and sustainable timber revenue, revitalizing ancient habitats, and improving the health of the Blue Creek watershed. WRC has purchased 47,097 acres of land along Blue Creek in Northern California, with nearly 15,000 acres currently protected as salmon conservation areas with no logging allowed, while the remaining land is managed as tribal community forests with limited sustainable logging, and around 15,000 acres of land are involved in carbon projects.

According to 3Degrees, the revenue generated from selling carbon credit quotas for this project has helped the World Resources Institute purchase ancestral lands of the Yurok people and donate them back to the tribe. It is expected that the sustainable timber revenue from this project will also support the tribe in the long term.

Over the past five years, Microsoft has purchased a large number of carbon offset projects in various areas such as forest conservation, reforestation, and climate technology.

For example, in 2020, Microsoft invested over $100 million in carbon offset projects. These projects include forest protection globally, carbon capture and storage technology, as well as direct air capture technology. In 2021, Microsoft announced that it had purchased over 15 million tons of carbon offset credits, which come from various carbon reduction projects including reforestation, land management, waste management, etc.

In 2022 and beyond, Microsoft continues to expand its portfolio of carbon offset projects, including supporting new climate technologies and renewable energy projects.

However, there is still significant controversy over whether carbon offset projects can truly help reduce carbon emissions on Earth.

Firstly, the actual effects of some carbon offset projects may be exaggerated, with issues of insufficient monitoring and verification. Some projects may not have achieved the promised carbon reduction effects, or there may be cases where actual emissions are underestimated; some projects lack operational and financial transparency, making it difficult for outsiders to confirm their true environmental benefits.

Secondly, some carbon offset projects, such as afforestation, may take a long time to produce significant carbon reduction benefits, and the realization time of these benefits often does not match the current emission situation of the company.

Some projects may also have negative impacts on local ecosystems. Large-scale forest planting projects may threaten the habitats of native species. In some cases, carbon offset projects may affect the lives of local communities, involving land use rights or competition for water resources Some critics believe that companies purchasing carbon offsets are just trying to showcase their environmental image in public, rather than genuinely committing to reducing their own carbon emissions, as carbon offsets can only alleviate certain emissions, not completely solve the global climate change issue. In the long term, what is needed is a systematic reduction of greenhouse gas emissions, rather than just compensating through offsets.