- Microsoft signs massive methane gas deals to support growing AI workloads
- AI Expansion Pushes Hyperscalers Towards Faster Fossil Energy Solutions
- Microsoft data center emissions expected to rise sharply by 2028
Microsoft has signed a series of methane-powered AI data center deals totaling nearly 5 gigawatts of capacity, marking a departure from the company’s climate goals.
The race for AI supremacy is pushing hyperscalers to harness all available energy, and Microsoft has turned to fossil fuels to power its AI tools without delay.
The deals include an exclusive partnership with oil giant Chevron for a 2.5 gigawatt plant near Pecos, Texas, as well as additional facilities in Abilene, Texas, and Mason County, West Virginia.
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The gap between promises and actions
A study by Stand.earth Research Group claims that these projects will increase the carbon footprint of Microsoft data centers by 160%, reaching approximately 25.25 million metric tons of CO₂e by 2028.
“Microsoft makes big claims about its climate credentials, which makes it even more disappointing to see the company turn to fossil fuels,” said Rachel Kitchin, senior manager of corporate climate campaigning at Stand.earth.
Three years after its 2020 climate pledge to become carbon negative by 2030, Microsoft’s emissions had already increased by at least 30%.
Microsoft President Brad Smith recently declared himself “confident in our ability” to achieve the 2030 goal.
At the end of 2024, on-premises data centers accounted for only 5% of the total methane gas electricity demand developed in the United States. A year later, that figure jumped to 39%, as demand for LLM training and operation accelerated faster than renewable capacity could be built.
Developers say the methane gas available behind the meter eliminates the burden on existing utility customers. However, industry analysts warn that data center demand has already increased consumers’ electricity bills.
A Virginia Commonwealth University study found that on-site methane gas for a single data center could result in health-related costs of between $53 million and $99 million.
A 2021 Harvard University study also found that one in five deaths worldwide can be linked to air pollution from burning fossil fuels.
Research also suggests that data centers can increase local temperatures, indirectly increasing electricity bills due to higher demand for cooling homes.
Microsoft claims to meet 100% of its electricity demand with renewable energy, but these claims are based on energy markets that do not require direct delivery to its data centers.
The gap between what Microsoft says and what it does seems to be growing by the day.
Renewable energy is cheaper than fossil fuels, making Microsoft’s focus on methane for its AI tools difficult to defend.
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