Microsoft’s carbon emissions went up 25 percent last year
Key Takeaways
- Microsoft’s 2026 sustainability report shows the company’s carbon emissions rose 25 percent in 2025, reaching 34 million metric tons “without select interventions,” according to The Verge.
- Microsoft attributes the increase primarily to the expansion of its datacenter infrastructure, along with its decision last February to stop purchasing non-additional, unbundled renewable energy certificates, The Verge reports.
- The Verge notes that Google reported a similar 25 percent jump in supply chain emissions in its own 2026 sustainability report, while Amazon reported a 16 percent increase.
What Microsoft’s Report Actually Says
According to The Verge, Microsoft’s newly published 2026 sustainability report reveals that the company’s carbon emissions climbed 25 percent during 2025, bringing the total to 34 million metric tons “without select interventions.” The Verge, citing GeekWire’s reporting on the document, states that Microsoft frames this jump as being “driven primarily by the expansion of our datacenter infrastructure.” The report also points to a policy shift made in February, when Microsoft stopped buying what it calls non-additional, unbundled renewable energy certificates, a move that appears to have removed a tool the company had previously used to offset its reported emissions on paper.
This is not the first time Microsoft has stumbled on this particular goal. The Verge notes that the company set a target years ago to become carbon negative by 2030, meaning it aims to eventually remove more carbon from the atmosphere than it emits. Yet the 2026 report is not an isolated setback: The Verge points out that Microsoft’s 2024 sustainability report already showed a comparable rise in climate pollution, suggesting this is now a recurring pattern rather than a one-off blip tied to a single year of unusually heavy datacenter construction.
Perhaps the most notable admission highlighted by The Verge comes directly from the report itself, which states that while AI infrastructure is driving demand for energy, water, land, and materials, sustainability solutions are not scaling fast enough to meet that demand. In plain terms, Microsoft is acknowledging that the pace of building out AI capacity is currently outrunning the pace at which it can green that capacity.
Why This Matters for the AI Economy and Markets
Microsoft’s emissions increase is not happening in isolation. The Verge reports that Google disclosed a similar 25 percent spike in its supply chain emissions in its own 2026 sustainability report, and that Amazon reported a slightly smaller but still substantial 16 percent increase. Taken together, these disclosures from three of the largest cloud and AI infrastructure operators in the world point to a broader industry trend: the buildout of AI computing capacity is generating a measurable environmental cost that is rising faster than these companies’ own climate commitments can absorb.
For anyone tracking the AI economy, this matters because datacenter expansion is the physical backbone underpinning the current AI boom, from large language model training runs to the cloud services that businesses and, increasingly, crypto and blockchain infrastructure providers rely on. The Verge’s report also mentions that Amazon disclosed its data centers used 2.5 billion gallons of water in 2025, a figure Amazon says is lower than what Microsoft used, though the source article does not specify Microsoft’s own water usage number. These resource figures, spanning carbon, water, and energy, illustrate that the infrastructure race among Microsoft, Google, and Amazon carries costs beyond capital expenditure.
The ripple effects extend into markets that depend on the same underlying compute and energy resources, including crypto mining operations and blockchain networks that increasingly compete with AI workloads for access to power grids and datacenter capacity. When major cloud providers report that their own sustainability tools cannot keep pace with AI-driven demand, it signals tightening competition for energy resources more broadly. Investors and companies that rely on cheap, abundant power, whether for AI training or crypto mining, may find themselves watching regulatory and public pressure on these tech giants as a leading indicator of how energy costs and availability could shift across the wider digital economy.
It is also worth noting that missed climate targets from companies of this scale can invite closer scrutiny from regulators, shareholders, and environmental groups, which historically has translated into new disclosure requirements or energy policy debates. Given that Microsoft, Google, and Amazon collectively operate an enormous share of global cloud infrastructure, any resulting policy response could indirectly affect the cost structure of AI services and datacenter-dependent industries, crypto included.
Hype Check
Claim: Microsoft’s carbon emissions rose sharply due to its AI-driven datacenter expansion, according to its own 2026 sustainability report as covered by The Verge. Reality: The Verge confirms the 25 percent increase and the 34 million metric ton figure “without select interventions,” and Microsoft’s report itself attributes the rise to datacenter growth and a February policy change on renewable energy certificate purchases; The Verge also notes comparable percentage increases reported by Google and Amazon in the same reporting cycle. Verdict: Substance.
This is not financial advice.
Source
Researched with AI assistance, fact-checked and edited by a human. Not financial advice.