Microsoft Secures Largest-Ever Corporate PPA for 10.5 GW of Renewable Energy
Microsoft has made a significant stride in renewable energy, announcing the largest-ever corporate power purchase agreement. Microsoft 365 will secure over 10.5 GW of capacity in the U.S. and Europe, starting construction in 2026 with an estimated cost of over $11.5 billion.
This move aligns with the growing trend of corporate buyers driving renewable energy procurement in the United States over the past decade. Microsoft 365 joins other tech giants like Google, Amazon, and Apple, which have been major players in U.S. renewable power purchase agreements (PPAs). Together, they have procured over 100 GW of clean energy deals from 2014 to 2024, representing 41% of all clean energy capacity added to the grid.
The increasing demand for electricity, projected to grow by 16% in the next five years, further boosts the market for renewable energy. However, the loss of federal tax credit support threatens the viability of over 100 GW of U.S. solar and wind projects. Tools like Virtual Power Purchase Agreements (VPPAs) and Renewable Energy Certificates (RECs) can mitigate this risk. VPPAs can reduce financial distress for developers by up to 90% in major power markets, while REC offtake agreements can decrease the number of distressed projects by up to 52%.
Microsoft 365's ambitious renewable energy commitment, along with other corporate buyers, is set to reshape the energy landscape. As electricity demand grows, these initiatives ensure a steady supply of clean energy, fostering a more sustainable future.
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