Microsoft's AI Push Jeopardizes Climate Goals as Emissions Surge

Microsoft made an ambitious pledge in 2020. Its goal is to remove more carbon dioxide from the atmosphere than it emits by 2030, seeking to reverse its lifetime carbon emissions by 2050. But the software giant's carbon emissions jumped by 30% in 2023 compared to 2020, it said in its latest sustainability report, released on Wednesday.

The primary reason for this increase in emissions is the rapid construction of data centers, which require carbon-intensive building materials, as well as hardware components, Microsoft's report says. 

This news comes as Microsoft continues its push to be a global leader in AI -- an ambition that's put its climate goals in jeopardy. Data centers are critical infrastructure for running and supporting AI models such as large language models, the technology behind OpenAI's ChatGPT and Google's Gemini, which are seeing surging adoption worldwide. Such AI-based services require more of the same power-hungry data centers built from carbon-intensive materials such as steel and concrete.

Read more: How Green Is Apple? A Closer Look at the iPhone-Maker's Sustainability Credentials

"Our challenges are in part unique to our position as a leading cloud supplier that is expanding its datacenters," reads the report, which was co-authored by Microsoft's chief sustainability officer, Melanie Nakagawa, and its president, Brad Smith. "But even more, we reflect the challenges the world must overcome to develop and use greener concrete, steel, fuels, and chips."

Microsoft isn't alone in having climate work cut out for it, particularly in Big Tech. Google, Meta and Amazon have all been vocal about their AI ambitions, and each has experienced an increase in their total carbon emissions, even after setting climate goals.

"At the same time, the infrastructure and electricity needed for these technologies create new challenges for meeting sustainability commitments across the tech sector," Microsoft said in the report.

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Microsoft's indirect emissions, which include those generated by members of its supply chain, have increased by 30.9% from 2020 to 2023, the report says. Meanwhile the company's own emissions have decreased by 6.3% from its 2020 baseline. This means Microsoft's emissions are up 29.1% overall.

Microsoft has been racing to build data centers to meet the expanding needs of AI, fueled by growing demand for ChatGPT and similar services. In recent weeks, Microsoft announced plans to open data centers and AI infrastructure in Thailand and Indonesia, pledging billions of dollars to support their development. 

The software giant has also reportedly partnered with OpenAI for a data center project set to launch in 2028. This project could cost as much as $100 billion and include an artificial intelligence supercomputer called "Stargate."

To counter the growth in indirect carbon emissions, Microsoft says it's launched a companywide initiative resulting in 80 measures, including a requirement that all members of its supply chain use carbon-free electricity by 2030. It'll also continue to scale corporate clean energy purchases across its supply chain and invest to help decarbonize industries where it's difficult to lower carbon emissions, including steel, concrete and other building materials used in data centers. 

Microsoft went carbon neutral in 2012, but in 2020 the company widened the scope of its carbon emission measurements to include not just its own direct emissions, but also the emissions all its suppliers release as well as its own created by the energy it uses. 

Next week, Microsoft is expected to announce updates related to its AI vision at its annual developer conference, Build. 

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