Microsoft to purchase 18m tons of carbon credits from Rubicon Carbon

Microsoft has signed a carbon removal agreement with carbon credit management company, Rubicon Carbon, for 18 million tons of carbon removal credits.

The agreement, one of the largest single buyer agreements to date, will see Microsoft receive carbon credits from a pipeline of individual Afforestation, Reforestation, and Revegetation (ARR) projects worldwide.

Each removal deal will occur over 15-20 years and be tied to a range of projects within Rubicon’s portfolio. According to the companies, Microsoft’s investment will directly fund a range of ARR projects, allowing them to scale effectively.

“Addressing climate change requires more than good intentions—it requires capital deployment at scale,” said Tom Montag, CEO of Rubicon Carbon. “This collaboration serves as a blueprint for how the financial sector can meet the urgency of the moment while also generating strong financial returns. We aim to crowd in more capital by leveraging market-based mechanisms to scale societal impact at a planetary scale.”

The companies have also collaborated on an evaluation framework to ensure that the credits are of the highest quality. As part of this framework, Rubicon will source, assess, and conduct advanced due diligence on ARR projects worldwide, prioritizing those with strong potential for scale but limited access to capital.

In addition, Rubicon’s in-house science team will provide continuous quality assurance and monitoring, leveraging the latest remote-sensing technologies to support the verification process of each carbon credit generated.

“This agreement demonstrates how science, finance, and business model innovation can work in concert to scale affordable and high-quality climate solutions,” said Brian Marrs, senior director, Energy & Carbon Removal at Microsoft. “We believe that project finance needs to be central to the voluntary carbon market, and this deal signals the long-term demand for carbon removal necessary to mobilize infrastructure-grade investment and world-class execution.”

Rubicon was founded in 2022 and is headquartered in California. It has received financial backing from climate investment firm TPG Rise Climate. In addition to ARR projects, the company also supports a range of other carbon removal technologies. These include super pollution elimination, biochar, and biomass with carbon removal and storage.

The removal agreement is the latest in a long line for Microsoft, which is having a landmark year in carbon removal. Earlier this month, the hyperscaler signed a deal with sustainable forest management firm EFM to purchase three million carbon removal credits.

Last month, the company signed an agreement with Living Carbon to purchase 1.4 million tons of removal credits generated from Living Carbon’s large-scale reforestation project in the US Appalachian region.

Before this, it signed three deals, including an agreement to remove 1.5 million tons of CO2 in India, a 25-year agreement with Chestnut Carbon to purchase seven million carbon credits, and another 25-year deal in Brazil with Re.green to purchase 3.5 million credits.

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