Microsoft admitted a 25% increase in its CO2 emissions in the last fiscal year. The expansion of the data centers dedicated to artificial intelligence and the decision to stop purchasing “unbundled” renewable energy certificates, those sold separately from physical electricity production. The company’s own top management confirmed this in the environmental report published on 9 July.
A figure of 34 million tons of CO2 equivalent, never declared by Microsoft. That number, obtained from a graph in the report, actually represents a counterfactual scenario: how much the company would have emitted without the reduction measures already implemented, from the energy efficiency of the Xbox to sustainable aviation fuels to the decarbonization of the Surface supply chain. The real figure declared for the year stops at approximately 20 million tonshowever 25% more than the previous period.
The report, signed by the vice president and president Brad Smith together with the sustainability manager Melanie Nakagawaattributes the increase “primarily to the expansion of data center infrastructure” and the decision to suspend the purchase of the separated renewable certificates. The Scope 3which includes indirect emissions along the supply chain, remains the heaviest item in the budget. But the real anomaly of the year concerns him Scope 2the component linked to the direct consumption of electricity: goes from just under 2% to 13% of the total.
Because separated energy certificates are considered greenwashing
Unbundled renewable energy certificates, by definition of the US Environmental Protection Agency, are sold separately from the electricity actually generated. Those who purchase them can declare themselves powered by renewable sources without consuming a single watt of that energy, financing the development of new systems only remotely. It is a practice that most environmental observers classify as one form of greenwashingeven as companies defend it as leverage for the industry.
Already in February 2025, Microsoft had announced a stop to the purchases of “non-additional” certificates, explaining that it wanted to move those funds towards more lasting interventions: direct reduction of emissions, removal of CO2 and clean electricity supply agreements. In the report, the company reiterates that the objective remains to become carbon negative by 2030, while admitting that the choice could lead it out of its position of carbon neutrality in the short term.
Not all numbers go in the opposite direction to the declared objectives. For the first time, Microsoft restored more water than it took out, as well 14 million cubic meters in the fiscal year, a useful goal to counterbalance the water impact of the most recent data centers.
The underlying issue remains. The growth in consumption linked to artificial intelligence makes it increasingly difficult for large cloud providers to reconcile climate commitments with infrastructure expansion. Microsoft tries to justify the increase with the transparency of the new accounting criteria, but the 2030 goal will depend on how quickly the company manages to replace megawatts separated on paper with clean energy actually fed into the grid.
