Microsoft Secures 5 Million Tonnes of Carbon Removal in Early 2026

Microsoft has signed multiple carbon removal purchase agreements totalling nearly 5 million tonnes in the opening weeks of 2026, reinforcing its position as the world's largest corporate buyer of carbon dioxide removal. The deals include a 2.85 million tonne soil carbon agreement with Indigo Ag and a 100,000 tonne biochar deal with India-based Varaha.

Microsoft announced two new multi-year carbon credit purchase agreements representing nearly 3 million tonnes of removal, adding to a 2 million tonne Afforestation, Reforestation and Revegetation deal with Rubicon Carbon announced days earlier. The largest new agreement covers 2.85 million soil carbon removal credits from Indigo Ag over 12 years, generated through regenerative agriculture practices adopted by US farmers. The second deal covers more than 100,000 tonnes of biochar credits from Varaha, which operates 20 carbon projects across South Asia with a focus on smallholder farmers.

The Varaha deal is particularly notable for its India connection. Varaha's biochar project sources cotton stalks from smallholder farms in Maharashtra, converts them through biomass gasification, and generates carbon credits while simultaneously reducing open-field burning of crop residue and improving soil health. The project provides direct livelihood benefits to thousands of smallholder farmers through payments for contributing agricultural biomass, representing a model of carbon removal with co-benefits that is attracting growing attention from major corporate buyers.

Varaha is planning 18 industrial gasification reactors that will operate for 15 years, with a total projected removal volume exceeding 2 million tonnes of CO2. According to CDR.fyi, Microsoft has now purchased more than 34.6 million tonnes of carbon removal to date, well ahead of the Frontier buyers group, which stands at 1.9 million tonnes. Microsoft's director of carbon removal described Varaha's biochar project as broadening portfolio diversity while advancing co-benefits for farmers across Asia.

Key figure — 34.6 million tonnes