Microsoft has revealed its carbon emissions increased by more than 25 per cent in 2025.
Microsoft has revealed its carbon emissions increased by more than 25 per cent in 2025, highlighting the environmental cost of its accelerating investment in artificial intelligence and cloud infrastructure.
In its latest sustainability report, the tech giant said its total greenhouse gas emissions across Scopes 1, 2 and 3 rose from 16.2 million metric tonnes in FY24 to 20.3 million metric tonnes in FY25, a year-over-year increase of 25.1 per cent.
The company attributed the rise primarily to the rapid expansion of its global data centre footprint, which is being built to meet soaring demand for AI services.
Microsoft said: “Our total emissions (Scopes 1, 2, and 3) increased 25% year over year, driven primarily by the expansion of our datacenter infrastructure and pausing our use of non-additional, unbundled renewable energy certificates as we prioritize investments that bring net new power to grids.”
The company explained that it has stopped relying on certain renewable energy certificates that offset emissions on paper but do not directly create new clean energy generation.
They added: “While this decision increases our reported emissions in the near term, it enables us to increase the development of new CFE rather than relying on certificates alone. We believe this change will create more long-term sustainability benefits.”
The report also highlighted a sharp increase in Scope 2 emissions, which cover purchased electricity.
These emissions accounted for 13 per cent of Microsoft’s overall footprint in FY25, compared with around two per cent the previous year, reflecting the growing energy demands of AI infrastructure.
The company continued: “Scope 3 remains the largest share of our footprint overall, but one of the clearest changes this year was the growing contribution of Scope 2.
Despite the increase, Microsoft stressed that its sustainability initiatives prevented emissions from climbing even higher.
The company said investments in carbon-free electricity, energy efficiency, sustainable fuels and supply chain improvements helped avoid emissions that could otherwise have reached around 34 million tonnes.
Microsoft remains committed to becoming carbon negative by 2030, though the latest figures underline the growing challenge facing major technology companies as they balance ambitious AI expansion with environmental goals.
Microsoft admits carbon emissions rose 25 percent last year
