Microsoft released its 2026 environmental sustainability report, revealing that the company's carbon emissions rose 25 percent year over year in 2025 relative to the 2020 baseline. The uptick is largely linked to the scale of new AI data center infrastructure investments.

The expansion demands more energy, water, land, and materials. Microsoft acknowledges that sustainability solutions are figuring short of the pace required. The company states that it must refine its strategies as conditions change and tradeoffs become clearer.

An additional driver of the rise is the decision to stop purchasing unbundled renewable energy certificates, a practice that would have inflated emissions figures. Microsoft says the move allows it to focus on integrating all forms of carbon‑free energy into its operational grids, promising longer‑term benefits.

Despite the increase, the firm matched 100 % of its global electricity consumption with renewable sources and replenished more water than it withdrew, edging closer to its water‑positive goal for 2030. With only four years left, the company’s trajectory underscores the urgency for the tech sector to accelerate green infrastructure deployment.