Big Tech ramps up carbon credit purchases, as Microsoft announces record deal

Big Tech continues to buy up carbon credits

Big Tech continues to ramp up carbon credit purchases, as Microsoft kicks off 2026 with the announcement of a major new deal. The corporation has struck a record agreement with agricultural credits specialist Indigo Carbon. Microsoft will purchase 2.85 million soil carbon removal credits generated under the ‘Carbon by Indigo’ program, a United States-based project linked to regenerative agriculture.

Whilst the total value of the deal has not been disclosed, experts have priced the cost of the credits at between $60 and $80 per tonne, meaning it could be worth up to $228 million. The credits are linked to regenerative agricultural practices, such as reducing tilling, along with methods to improve soil carbon capture and water retention.

“Microsoft is pleased by Indigo’s approach to regenerative agriculture that delivers measurable results through verified credits and payments to growers, while advancing soil carbon science with advanced modelling and academic partnerships. Indigo is strengthening the carbon market through their commitment to enhancing project quality, championing the improvement of third-party standards, and producing high-integrity carbon removal credits.”[i] Phillip Goodman, Director of Carbon Removal at Microsoft, said.

Microsoft plots a course for carbon negativity by 2030

The deal marks the third transaction between Indigo and Microsoft, building on prior purchases of 40,000 tonnes of removal credits in 2024 and 60,000 tonnes in 2025. It forms part of a concerted push by Microsoft towards carbon removal as the corporation targets becoming carbon negative by 2030 and erasing all historic emissions by 2050, all while tackling rising emission from data centre growth driven by AI.

The corporation has heavily invested in carbon dioxide removal (CDR) and as of early 2025, Microsoft was the biggest purchaser of carbon credits, accounting for 63% of total CDR purchase volume in 2024, securing around 5.1 million metric tonnes of CDR credits[ii]. This dwarfs Google which secured just over 500,000 tonnes in the same period. Microsoft now has a range of investments in carbon removal technologies, including a 10-year deal with Arca Climate Technologies for 300,000 tonnes of CDR credits for carbon stored in mine tailings, direct air capture projects (such as Canada’s Deep Sky), as well as major biomass sequestering projects in the U.S. and Europe[iii]. Latest data places total Microsoft CDR purchases at 35 million tonnes, ahead of Frontier Buyers with 1.9 million tonnes, and Google with 960,000 tonnes[iv].

AI growth sees Big Tech buying up carbon credits, risks smaller players being priced out

Carbon markets have seen rapid growth in recent years, as businesses seek to utilise carbon credits to offset emissions and meet their sustainability targets and regulatory requirements. Demand for high-quality carbon removal credits is accelerating with this in large part attributable to tech giants racing to offset emissions from AI-powered growth, leading to fears around future scarcity[v].

Big Tech firms have heavily purchased credits, pushing up prices for durable removals (those that capture and lock away carbon long-term) to almost four times higher than traditional forest-based credits. Since 2019, corporations have poured hundreds of millions into these solutions, contributing to an estimated $10 billion spent across spot markets and long-term offtake deals, according to CDR.fyi[vi].

Carbon removal is becoming increasingly leaned upon as a method to achieve climate goals, offsetting emissions in sectors still reliant on fossil fuels. Premium credits tied to technologies such as biochar and direct air capture, or projects restoring degraded land, are commanding strong demand for their permanence and reliability.

As AI expansion drives energy use and emissions, companies are reinvesting profits into climate strategies, creating a feedback loop where AI growth fuels both carbon output and offset spending.