Microsoft indicators large carbon credit score take care of reforestation startup Chestnut Carbon

Microsoft introduced Thursday that it’s shopping for over 7 million tons of carbon credit from Chestnut Carbon.

The 25-year deal would allow Chestnut Carbon to reforest 60,000 acres of land throughout Arkansas, Louisiana, and Texas, Axios reported. Recently, the tech firm has struggled to rein in its carbon emissions as AI has pushed a surge in information middle development and use. 

Microsoft reported final 12 months that its emissions rose 29% since 2020 because of the growth in AI and cloud computing, imperiling its 2030 purpose to sequester extra carbon than it produces. In 2023, the corporate reported producing 17.1 million tons of greenhouse gasoline emissions earlier than offsets.

Carbon credit are available a variety of flavors. Chestnut Carbon focuses on reforestation, by which the corporate facilitates tree planting after which displays the brand new forests to make sure they develop as deliberate and aren’t reduce down. The firm at present has eight tasks within the Southeast U.S., which had been beforehand labored as farms or pastures. 

Trees naturally sequester carbon as they develop, although not all forest-related carbon credit are created equal. Credits from tasks that plant non-native, fast-growing bushes are usually seen as decrease high quality and promote for much less since they don’t are inclined to assist as a lot biodiversity, and the bushes don’t are inclined to reside as lengthy. Projects that assist various, native plantings sometimes promote at a premium for the reason that ecosystems that outcome are usually extra resilient over time.

Even premium carbon credit from afforestation, reforestation, and prevented deforestation are a relative deal in contrast with some alternate options. Chestnut Carbon bought credit final 12 months for $34 per ton, whereas direct air seize, which makes use of followers and chemical sorbents to attract CO₂ out of the ambiance, prices round $600 to $1,000 per ton right now. Despite the associated fee differential, Microsoft has additionally purchased carbon credit from direct air seize startups.

For all their strengths, nature-based carbon credit aren’t at all times good. Verra, which has the most important nature-based carbon credit score portfolio, was the topic of an in depth investigation in 2023 which reported that the group overstated the local weather good thing about its tasks. The scandal led to the CEO’s ouster and made the trade reassess the requirements it makes use of. Chestnut Carbon, which beforehand used Verra to certify its carbon credit, right now makes use of Gold Standard.