Microsoft Corp has recently forged a significant partnership with carbon offset startup Chestnut Carbon, signaling a pivotal step in Microsoft’s unwavering commitment to sustainability.
In contrast to conventional offset agreements centered around preserving existing trees, Chestnut stands out by adopting a unique approach—planting new trees on previously farmed or underutilized land. According to founder Ben Dell, this initiative represents the most extensive afforestation project ever registered in the United States.
The Dynamics of the Deal
The collaboration entails Microsoft acquiring carbon removal credits from Chestnut over a 15-year period. These credits are tied to trees planted in the Mississippi Alluvial Valley, with the first batch set to be delivered to Microsoft in three years. This delay allows for the maturation of the planted trees, as explained by Dell.
Although specific financial details remain undisclosed, the agreement is poised to result in the removal of up to 2.7 million tons of carbon over the contract’s duration. Brian Marrs, senior director of energy & carbon removal at Microsoft, expressed enthusiasm about collaborating with Chestnut Carbon on its Sustainable Restoration Project, emphasizing the high-quality, nature-based solutions located in the United States.
Microsoft Chestnut Carbon-Negative Vision
For Microsoft, carbon removal programs are integral to realizing its ambitious goal of becoming carbon negative by 2030—actively contributing to the net removal of greenhouse gases from the atmosphere. In 2022 alone, Microsoft contracted for over 1.4 million metric tons of carbon removal, utilizing various techniques such as afforestation and technological solutions like direct air capture.
Notably, Microsoft serves as the inaugural client for Chestnut carbon, a venture backed by private equity firm Kimmeridge Energy Management. The revenue generated by Chestnut through this collaboration will enable the redeployment of a portion of Kimmeridge’s initial $200 million capital commitment into new land acquisitions for Chestnut, according to Dell, who also serves as Kimmeridge’s managing partner.
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