Software giant Microsoft has agreed to buy 40,000 agricultural soil-based carbon credits from Indigo Ag, a single-transaction purchase record for the sustainable agriculture company.
The credit purchase will help Microsoft achieve its 2030 carbon neutral target. In 2022, Scope 3, or indirect emissions across the company’s value chain, accounted for 96% of Microsoft’s total emissionswhich the company will be able to compensate through the purchase in the future.
The announcement came days later BTG Pactual Timberland Investment Group announced it would sell Microsoft 8 million nature-based carbon removal credits through 2043. The credits will be delivered from TIG’s $1 billion reforestation and restoration strategy in Latin America. The companies called “the largest known credit transaction for carbon dioxide removal to date.”
One carbon credit is equal to one ton of carbon captured.
Indigo Ag has the only current project that can generate soil enrichment protocol credits by both increasing soil organic carbon and reducing greenhouse gas emissions. Approved in May, Indigo Ag’s is the first model to receive independent expert validation and approval from the DayCent-CR model measure credits.
“Organic carbon recovery in soil is essential for the future of food systems, economies and climate change mitigation,” said Brian Marrs, senior director of energy and carbon removal at Microsoft, in a press release.
The credits sold in the Microsoft transaction were generated from Indigo Ag’s third issuance of carbon credits and verified by the Climate Action Reserve Soil Enrichment Protocol.
Hundreds of farmers from 28 US states sold credits to Indigo Ag in the company’s third issuance of carbon credits. Reducing tillage, rotating crops and planting cover crops are some of the practices farmers can implement or intensify to produce credits that can be sold to Indigo to improve soil while generating additional agricultural income.
At least the payment programs facilitated by Indigo Ag are getting results, according to the company’s website 75% of the average credit price directly to the farmer. Minimum $20 per credit is paid to farmers. Approximately 6.9 million hectares have been registered in the US and Indigo has issued almost 300,000 credits.
To date, Indigo Sustainability Solutions has reduced and removed more than 340,000 metric tons of greenhouse gas emissions and saved more than 40 billion gallons of water used in agriculture. The company has more than 18 global credit buyers, according to the websiteincluding The North Face, New Belgium Brewing and Blue Bottle Coffee.
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