Microsoft has signed a deal with energy firm Stockholm Exergi to help it meet its ambitions to become a net zero carbon company by 2030 by absorbing emissions from biomass power plants.
The deal will see some 3.33 million tonnes of permanent carbon removals from bio-energy with carbon capture and storage (BECCS) at a plant in Värtan, Stockholm.
But scientists have previously expressed doubt that this method of carbon removal is an efficient way to reduce global emissions. A 2018 letter to the European Parliament signed by nearly 800 scientists said that “cutting down trees for bioenergy releases carbon that would otherwise stay locked up in forests, and diverting wood otherwise used for wood products will cause more cutting elsewhere to replace them”.
It called on the body to restrict the forest biomass eligible under the directive to residues and wastes from industries such as paper-making and timber products, which would ultimately degrade and release carbon into the atmosphere anyway if not used for energy production.
Stockholm Exergi claims its biomass sourcing is sustainable and that it maximises the energy potential of its feedstocks by distributing any excess heat not used in electricity generation to a local district heating network.
It said the agreement with Microsoft represents “the world’s largest permanent removals deal” to date. The deliveries of the carbon removal certificates to Microsoft are planned to start in 2028 and continue for a period of 10 years. It claims it currently achieves around 800,000 tonnes a year in permanent carbon removals.
Microsoft plans to become a net zero company by 2030, and by 2050 it has pledged to remove additional carbon from the atmosphere amounting to all the carbon it has used since its founding in 1975.
Anders Egelrud, Stockholm Exergi CEO, said the deal marked “a huge step forward for our BECCS project”.
“It is the strongest possible recognition of the significance, quality and sustainability of our project and takes us an important step closer to a final investment decision in Q4 2024,” he said. “I believe the agreement will inspire corporations with ambitious climate objectives, and we aim to announce more deals with other pioneering companies over the coming months.”
The firm intends to seek complementary state aid and additional private carbon removal deals, both of which are necessary to reach financial close on the deal.
Brian Marrs, Microsoft’s senior director of carbon removal, said: “Leveraging existing biomass power plants is a crucial first step to building worldwide carbon removal capacity.
“In this case, we are pleased with the efficiency of recovering heat from carbon capture and adding it into district heating networks. Finally, it is crucial to sustainably source the biomass for BECCS projects, and we were impressed with Stockholm Exergi’s commitment in this regard.”
Stockholm Exergi said the deal includes “strict quality requirements” including criteria for sustainable sourcing of forest biomass developed with Microsoft and “conservative quantification of net removals and comprehensive monitoring”.
