What is Microsoft's Sustainability Strategy, And How Are Channel Partners Involved?

Microsoft expects to be carbon negative by 2030, and by 2050 the company will remove from the environment all the carbon the firm has emitted either directly or by electrical consumption since it was founded in 1975, the cloud and software giant said in 2020.

Melanie Nakagawa (pictured above), chief sustainability officer, is leading those efforts. But the software company's sustainability goals don't end there.

Microsoft, led by CEO Satya Nadella, also develops cloud-based sustainability software tools for partners and customers to leverage. And the Microsoft Climate Innovation Fund continues to invest in sustainable startups.

The timeline below, updated regularly, further explains Microsoft's sustainability strategy, key milestones, customer engagements, partner integrations and more. Check back regularly for updates.

Sustainability: December 2025 Updates

December 1 - CEO on AI Energy Concerns: Microsoft CEO Satya Nadella warned that the vast amount of energy consumed by AI could turn people against the industry — and that AI and tech companies need to earn public trust to turn things around, Politico reported.

Sustainability: November 2025 Updates

November 28 - Diversity, Equity and Inclusion (DEI): Microsoft will not publish an updated version of its annual diversity and inclusion report for 2025, ESG Dive reported. Instead, Microsoft will demonstrate its D&I progress through formats like stories, insights and videos, which Microsoft believes are “more dynamic and accessible” and “show inclusion in action,” according to a Microsoft statement to ESG Dive.

November 28 - Data Center Executive Departs: Microsoft veteran Sean James has joined Nvidia as a distinguished engineer of energy systems. He previously was senior director of energy and data center research at Microsoft. His career focus seeks to "contribute significantly to the global dialogue on sustainable computing and energy use in the technology sector," according to James' LinkedIn account. Related: Nvidia sustainability strategies.

November 24 - Power Purchase Agreement (PPA): Microsoft will purchase solar energy from Zelestra to power infrastructure in Spain. As part of the agreement, nonprofit organization ECODES will receive funding to support community-led sustainability initiatives in the region.

November 18 - IT Services and Environmental Goals Research: Roughly 78% of integration-focused organizations highlight IT as a key enabler in achieving sustainability goals, leveraging data, automation, and AI for measurable impact, and 56% of IT teams now lead sustainability efforts beyond IT, up from 38% in 2024. (Source: Global Sustainability Barometer Study from Ecosytm, Kyndryl and Microsoft). Related: All sustainability research reports.

November 18 - Funding AI Services: NVIDIA and Microsoft plan to invest up to $10 billion and up to $5 billion, respectively, in Anthropic. On the flip side, Anthropic has committed to purchase $30 billion in Azure compute capacity.

November 12 - Partner of the Years: Microsoft named EY as its Sustainability Changemaker Partner of the Year for 2025. Three finalists for the world included Schneider Electric, Wipro and NTT Data.

November 12 - Data Center Energy Efficiency: In a successful demonstration, VEIR delivered 3 megawatts of power via a single low voltage cable within a simulated and scalable data center environment. The development could help relieve the power bottleneck facing AI data centers. VEIR raised $75 million in Series B funding in January 2025. Key investors include Munich Re Ventures, Microsoft’s Climate Innovation Fund, and National Grid.

Sustainability: October 2025 Updates

October 20 - Perspectives: Charlie Sellars, director of sustainability for the cloud operations and innovations team at Microsoft, talked technology and the environment during an engagement at Duke University.

October 13 - Microsoft Azure API Software: Microsoft is previewing various environmental sustainability features in Azure API Management.

October 9 - Big Tech Scrutiny: Multiple U.S. states are investigating renewable energy claims made by Amazon, Google, Meta and Microsoft, according to Trellis.

October 9 - Asia Renewable Power Challenges: Microsoft warned that it is competing for limited supplies of clean electricity in parts of East Asia, even as its window to achieve a key 2030 climate target narrows, Bloomberg reported.

October 2 - Transportation Services: Microsoft has aligned its transportation services strategy with the company's sustainability strategy. For instance, Microsoft provides electric vehicle (EV) charging stations at many Puget Sound campus locations for employee use. The company also offers transit passes, guaranteed rides home, and other rideshare options, a blog from the company noted.

Sustainability: September 2025 Updates

September 26 - AI Strategies: During Climate Week NYC, Microsoft described various ways AI can advance sustainability

September 25 - Green Steel: The company plans to leverage near-zero emission steel from Segra. Microsoft, which invested in the business in 2023, is not a direct buyer of materials such as steel. Instead, Microsoft will work with its suppliers to receive the coils from Stegra and process the green steel into components designated for use by Microsoft's datacenter equipment suppliers, the firms said.

September 24 - Low Carbon Cement Production: Microsoft has invested in green cement manufacturer Fortera. Amid the investment, Microsoft gains procurement rights for Fortera's low-carbon cement.

September 18 - AI Data Centers and Renewable Energy Partnership: The company has signed a $6.2 billion deal with Aker and Nscale. The partnership involves renewable energy and European data centers. Nscale and Aker also are working with OpenAI to establish Stargate Norway -- a Northern Norway data center project that involves 100,000 Nvidia GPUs and renewable energy.

September 18 - Water Management Software Partnership: Shayp has launched 4Impact, a technology platform and funding program that allows buildings to monitor and manage water consumption. Key partners include Microsoft. Together, Shayp and Microsoft will assist 125 schools in Brussels and 500 schools and public buildings in Paris with water consumption management, Startups Magazine reported.

September 3 - Microsoft Further Embraces Nuclear Energy: Microsoft has joined the World Nuclear Association.

Sustainability: August 2025 Updates

August 29 - Employees Fired: Microsoft has fired four employees who participated in protests on company premises against the firm's ties to Israel as it wages war in Gaza, including two who took part in a sit-in this week at the office of the company's president. (Source: Reuters)

Sustainability: April 2025 Updates

• AI for Good: Keep an eye on Microsoft's AI for Good research lab...
• AI Complicates Net Zero Goals: Microsoft's AI push has made it four times more difficult for the company to achieve carbon negative goals by 2030, Vice Chair and President Brad Smith said during a Microsoft employee town hall, Times of India reported.

Sustainability: March 2025 Updates

• Data Center Expansion Slowdown: Microsoft has abandoned new data center projects in the United States and Europe that would have amounted to a capacity of about 2 gigawatts of electricity, according to TD Cowen analysts, Bloomberg noted. The reason involves an "oversupply of the clusters of computers that power AI," the report noted.
• AI Playbook: Microsoft outlined five ways to advance sustainability in a recent AI playbook.
• Cloud Services - Return on Investment: Financial Services giant Emirates NBD, leveraging Microsoft Sustainability Manager, has cut its data reporting time from three months to one week; and achieved near real-time visibility into its environmental impact, Microsoft reported.
• Partnership: SBM and Microsoft are partnering to develop standardized, AI-powered carbon-free floating power solutions to address the growing needs for reliable, affordable, carbon-free electricity, the companies said.
• Renewable Energy Opportunities: U.S. wind and solar development still has significant room for expansion to power data centers, particularly in the Midwest wind corridor and sunny southwest, Microsoft VP of Energy Bobby Hollis told Reuters.
• Software - IT Carbon Accounting The Sustainable Digital Infrastructure Alliance (SDIA) has certified the Dynatrace Cost & Carbon Optimization app. The certification essentially confirms that Dynatrace's software "is a reliable estimation system for calculating the operational GHG emissions of IT infrastructure in cloud and on-premises environments," the SDIA said. The app allows customers to calculate greenhouse gas (GHG) emissions for AWS, Microsoft Azure, Google Cloud Platform (GCP), and on-premises host instances. 

Sustainability: February 2025 Updates

• Did Microsoft Cancel Some Data Center Leases?: Microsoft has begun canceling leases for some datacenter capacity in the United States, TD Cowen reported, and the move may reflect concerns about whether Microsoft is building more AI computing than it will need over the long term, Bloomberg speculated. However, Microsoft refuted the TD Cowen report.
• Partnership - Professional Services and AI Software: WSP and Microsoft are partnering to drive digital transformation projects for Architecture, Engineering and Construction (AEC) customers.
• CSO Perspectives: In a blog, CSO Melanie Nakagawa described various sustainability milestones and challenges at the cloud software giant. 
• Startup Funding: Chestnut Carbon has raised $160 million in Series B funding to plant, restore and manage trees on degraded farmland. Key carbon credit customers include Microsoft. Canada Pension Plan led the latest funding round.
• Power Purchase Agreements (PPAs): Microsoft is leveraging more renewable energy from EDP Renewables, the energy supplier said.
• United States - Washington Data Center Study: Washington Governor Bob Ferguson is forming a workgroup to explore the impact of data centers in the state. The executive order surfaces amid growing demand for AI data centers -- which has pressured energy suppliers nationwide. Amazon and Microsoft, among others, have a heavy data center presence in Washington. Under the executive order, the workgroup has until December 1 of 2025 to submit its findings and recommendations, GeekWire reported.
• Integration - Energy Management and Cloud Services: Baker Hughes is further optimizing and integrating their energy management software with Microsoft Azure cloud services, the companies said.

Sustainability: January 2025 Updates

• Executive Leadership - Microsoft Energy Strategy: Microsoft has shifted Erin Henderson from head of its nuclear development acceleration to director of energy infrastructure.
• Grant Program: Microsoft has launched AI for Good, a $5 million grant program for nonprofits, academic institutions, individual researchers, startups and businesses based in or benefiting Washington state. Projects must focus on sustainability, public health, education or human rights.
• Cloud Software: Microsoft continues to develop AI-related updates to its Cloud for Sustainability Software, according to Brandon Potter, director of the software platform.
• Carbon Credits: Microsoft has signed a 25-year carbon removal agreement with Re.green, a Brazilian reforestation startup, Data Center Dynamics reported. Under the terms of the agreement, Microsoft will purchase 3.5 million carbon credits during the specified period, the report said.
• Xbox Right to Repair: Microsoft has introduced more Xbox repair and sustainability options. On January 20, uBreakiFix by Asurion will become the first Xbox Authorized Service Provider to repair Xbox consoles at its nearly 700 participating store locations across the U.S. Moreover, replacement components for the three Xbox Series X|S console options are now available for purchase via the Microsoft Store and replacement console parts are also now available for purchase online via the Microsoft Repair Hub on iFixit, the technology giant said. Microsoft also is touting an Xbox Sustainability Toolkit, which helps developers to create more energy-efficient games. 
• Financial Services and ESG Data: Microsoft's various software tools can help financial services firms to manage their ESG data, Matthew Sekol asserts in a blog. Sekol is a "sustainability global black belt" at Microsoft, according to his LinkedIn profile.
• Data Center Challenge: The company has paused construction on portions of its multibillion-dollar data center campus in Mount Pleasant, Wisconsin, to "incorporate new data center designs," according to Wisconsin Public Radio. The report did not mention whether energy supplies or grid considerations were involved with the delay.
• AI Data Center Investments: The company plans to spend $80 billion to build out AI-enabled data centers in fiscal year 2025, according to a blog from Brad Smith, vice chair and president of Microsoft. Alas, the lengthy blog did not mention how the company will leverage renewable energy and/or nuclear energy to power all of those new data centers.

December 2024 Updates

• Cloud Data Centers and Server Equipment: Carnegie Mellon University, Microsoft and the University of Washington have developed a way to identify older components that can be re-used in servers without affecting operations, the IEEE reported. The re-used components, known as GreenSKUs, can run in the Azure cloud service, the report noted.
• Accelerator: The Colorado-Wyoming Climate Resilience Engine (CO-WY Engine), in partnership with Microsoft, has launched a Digital Twins Deployment Accelerator. The program helps startups that develop and commercialize digital twins technology, with a focus on climate resiliency applications. The accelerator will provide business, technical, and commercialization support to roughly 10 to 12 startup ventures.
• AI Chip Purchases: The company has acquired twice as many Nvidia AI chips as rivals, the Financial Times reported.
• Cloud Software - Mining Solutions: In a lengthy blog, the company described how AI can help mining companies with their innovation and sustainability initiatives.
• AI Workloads: Microsoft in August 2024 launched a new datacenter design that optimizes AI workloads and consumes zero water for cooling, the company disclosed in December.
• Right to Repair: iFixit has agreed to support official replacement parts for Microsoft Xbox Series S and Series X consoles. The partnership "aims to help gamers keep their consoles running longer, as issues with performance or hardware can often lead to frustration and the need for repairs," The Pinnacle Gazette reported.
• Accelerator: The fourth edition of Zero, a Cleantech Accelerator backed by CDP Venture Capital, launched in December 2024. Key backers of the accelerator include ENI, Acea, Marie Tecnimont and Microsoft Italia.
• Cloud Services: Microsoft Cloud for Sustainability has gained new AI services, the company said.

Microsoft Sustainability: November 2024 Updates

Multiple updates...

• Research - IT Services: Only 21% of organizations use technology to reduce their environmental footprint and shape their overall sustainability strategy, Kyndryl and Microsoft research found.
• Request for Information: The Net Zero Innovation Hub (NZIH) has launched a Request for Information (RFI) that seeks net zero data center backup power solutions in Europe. The hub --launched by Danfoss, Data4, Google, Microsoft, Schneider Electric and Vertiv -- seeks to "accelerate the deployment of innovative solutions which can substitute diesel back-up generators."
• Energy Management Systems: Engenuity Systems has introduced eViewIoT PRO for Retail, an IoT energy management platform designed to "optimize equipment runtimes and reduce energy consumption." The application is built on Azure cloud services.
• Data Centers: Microsoft is building its first datacenters made with ultra-lightweight wood in a bid to slash the use of steel and concrete, which are among the most significant sources of carbon emissions, the company said. Related: Microsoft sustainability strategy.

See next page for earlier updates...