Microsoft contracts additional one million tonnes carbon removal from Orsted BECCS hub

Orsted agreed to sell Microsoft an additional one million tonnes of carbon removal over a decade from its Avedore Power Station, lifting their total contracted removal to 3.67 million tonnes. For Indian corporates pursuing net-zero targets, the deal illustrates how large buyers are securing high-cost engineered removals to back climate commitments.

Orsted agreed to sell Microsoft an additional one million tonnes of carbon removal over a decade from the straw-fired unit at Avedore Power Station, part of the Orsted Kalundborg CO2 Hub bioenergy carbon capture and storage project. This adds to Microsoft's existing commitment of 2.67 million tonnes from Asnaes Power Station, bringing total contracted CO2 removal to 3.67 million tonnes. The combined plants will produce 430,000 tonnes of biogenic CO2 annually, transported to permanent storage in the Norwegian North Sea. The hub is scheduled to be operational by early 2026.

Microsoft is directly affected as the buyer, advancing its goal of becoming carbon-negative by 2030 through engineered removals. Orsted, as developer, depends on revenue from carbon removal certificate sales to make the project financially viable despite a Danish Energy Agency subsidy. The agreement matters for the broader BECCS sector, which remains emerging, and for corporate buyers seeking verified negative emissions. The IPCC has identified removal technologies like BECCS as necessary to limit global warming, underscoring relevance for any company depending on removals to meet net-zero goals.

Companies relying on carbon removals should monitor the Orsted Kalundborg CO2 Hub's commissioning, scheduled for early 2026, as Microsoft's one million tonnes from Avedore begins delivery that year. Buyers should note the project's emphasis on competitive offers with minimal subsidy per tonne, signalling cost expectations for high-quality removals. Corporates pursuing carbon-negative or net-zero targets should evaluate long-term offtake agreements for verified biogenic removals and track how BECCS scales, given its role in IPCC pathways for limiting warming.

Key figure — Total contracted CO2 removal: 3.67 million tonnes