- Microsoft produced 20.3 million tons of CO2e emissions last year, up from 16.2 million tons
- Of the 37.5 million MWh of energy used, only 422,000 MWh came from non-sustainable sources
- An increase in diesel/crude oil consumption and Scope 2 emissions are key factors
In its latest sustainability report, Microsoft admitted that its greenhouse gas emissions actually increased 25.1% year-on-year from 16.2 million tons to 20.3 million tons in 2025.
With the company aiming for a carbon-negative deadline of 2030, rising emissions pose a major challenge for it to overcome, but current trends point to emissions continuing to rise even further.
Microsoft said its rapid expansion of artificial intelligence and cloud data centers is a key driver of rising emissions, and with more projects in the pipeline, this could be an ongoing challenge in the coming years.
Microsoft’s emissions are moving in the wrong direction
The company also noted its decision to stop buying short-term renewable energy certificates that do not directly support additional clean capacity. While the previous year’s 16.2 million tonne figure was lower than last year’s, it was largely offset by carbon credits and does not accurately represent true emissions.
More broadly, Scope 2 and Scope 3 emissions are also under pressure from continued data center expansion due to electricity purchases, unsustainable building materials and computer hardware. For example, Scope 2 emissions went from accounting for 1.6% of total emissions in FY24 to a staggering 13.3% in FY25.
In terms of fossil fuel use, the company saw a 51% increase in diesel and crude oil consumption, despite reductions in the use of natural gas (-6.5%), propane/LPG/jet fuel (-10%) and gasoline (-16%). Yet only about 422,000 MWh of the nearly 37.5 million MWh of energy the company used in FY25 came from non-renewable sources (according to a separate data sheet).
Despite expansion-related challenges, however, Microsoft made significant progress in reducing overall emissions, reaching about 20 million tons last year instead of the 34 million tons it could have hit without work on carbon-free electricity, sustainable fuels, energy efficiency improvements and other agile chain refinements.
Microsoft is not the only company struggling with the effects of AI – Amazon also recently noted a 16% annual increase in emissions, while blaming AI and data centers. Google also saw a 25% increase in emissions for its most recent full year.
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