Microsoft announced that it entered into an agreement for a project in Louisiana that would sequester 6.75 million metric tons of carbon dioxide over 15 years, which it claims is the largest permanent carbon removal project in the world to date.
The technology giant’s greenhouse gas emissions last year were 29.1% above levels in 2020 as increasing demand for power for artificial intelligence applications and other purposes and it most recently reported annual greenhouse gas emissions of 17.2 million tons towards the end of 2023.
AtmosClear’s carbon capture project, which is to be developed in the Port of Greater Baton Rouge, utilizes materials such as sugarcane bagasse and forest trimmings to produce energy, with the corresponding carbon emissions being captured and sequestered underground.
The deal is one of the efforts by Microsoft to achieve carbon negativity by 2030.
The move is made as the future of U.S. carbon removal and sequestration projects, which have been encouraged in recent years by an $85 a ton federal tax credit called 45Q, remains uncertain. The Trump administration is trying to roll back several decarbonization incentives that were enacted during former President Joe Biden’s tenure in office in future budget negotiations.
The firms declined to comment on whether the project will go ahead if the tax credit is reduced or repealed by the Trump administration. Fidelis, the firm based in Texas that owns AtmosClear, said it anticipates utilizing the 45Q tax credit for the carbon sequestration part of the project.
Fidelis has put the project at over $800 million of investment and approximately 75 permanent and 600 construction positions, and potentially bring back forestry management employment in the area that had been affected by recent mill shutdowns.
Brian Marrs, Microsoft’s senior director of energy and carbon, stated in a release the technology company appreciated the focus of the deal on jobs in local agricultural communities. It would also demonstrate Louisiana’s leadership in becoming a center for carbon management research and applied technology, he added.
Louisiana state officials have been lobbying the U.S. Department of Energy and the state congressional delegation in the past few days to persuade them to preserve federal funding to facilitate the state’s proposed Direct Air Capture facility in Calcasieu Parish, as well as the 45Q tax credit. The plant would be constructed starting from 2026, and commercial operations would be initiated in 2029.
