March 6, 2025 – Microsoft has signed a landmark 30-year carbon removal agreement in collaboration with Climate Impact Partners and Terra Natural Capital, committing to the purchase of 1.5 million tonnes of verified carbon removal credits. The initiative supports a large-scale afforestation project in India’s Madhya Pradesh State, aimed at combating climate change and promoting community-driven sustainability.

Microsoft’s First Carbon Removal Deal in India

Under the agreement, Microsoft will acquire half of the Panna afforestation project’s estimated 3 million-tonne carbon credit output over the next three decades. Spanning 20,000 hectares, the project will see the planting of up to 11.6 million mixed native trees on farmer and community lands.

Erica Vertefeuille, Managing Director at Terra Natural Capital, emphasized the deal’s role in bridging corporate demand with climate finance:

“This transaction reflects the power of collaboration between trusted project developers, corporate demand, and innovative finance to unlock climate impact. We recognize that access to project finance is a critical need for the carbon removal market to scale and are committed to providing long-term capital that will accelerate project development and empower corporates to achieve their climate targets.”

A Step Toward Microsoft’s Carbon Negative Goal

This agreement is part of Microsoft’s ambitious plan to become carbon negative by 2030 and contributes to its rapidly expanding carbon credit portfolio. The company has already invested in various large-scale afforestation, ocean-based carbon removal, biochar projects, and direct air capture (DAC) technologies.

Brian Marrs, Senior Director Energy Markets at Microsoft, underscored the importance of nature-based solutions:

“At Microsoft, we believe that high-quality, nature-based solutions are vital to addressing climate change. Panna forms an important part of our growing portfolio of carbon removal projects – our first in India and largest in the APAC region.”

Beyond Carbon Removal: Community and Environmental Benefits

The initiative extends beyond carbon sequestration, bringing multiple benefits to local communities, including:

Economic empowerment: A share of carbon credit revenue will go to farmers.
Income generation: Trees will produce fruits and medicinal crops for local markets.
Climate-smart agriculture training: Programs will enhance long-term agricultural yields.
Water conservation: Large-scale infrastructure to capture and store water will be implemented.
Biodiversity restoration: Native species will attract butterflies, birds, and other wildlife back to degraded lands.

Scaling Carbon Removal Through Corporate Commitment

Sheri Hickok, CEO of Climate Impact Partners, highlighted the project’s role in growing the carbon removal market:

“By securing a long-term supply of high-quality carbon credits, this model empowers companies like Microsoft to meet their ambitious climate targets, drive growth in the carbon removal market, and bring benefits to communities most impacted by climate change.”

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With Microsoft leading the way, long-term corporate commitments could accelerate large-scale afforestation efforts, driving both climate resilience and socio-economic development in vulnerable regions.

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