Overview Carbon Water Waste Ecosystems Appendix 18 Carbon negative (continued) Moving to 100% renewable energy assets, as well as their customers’ consumption, to supply We support local Supporting climate equity and environmental justice By 2025, we will reach our 100 percent renewable energy them with continuous renewable energy. Azure IoT We recognize that climate and environmental issues don’t goal by purchasing enough renewable energy to match our solutions also allow users to adjust their business communities in which affect every community in the same way and that we need electricity consumption at our datacenters, buildings, and operations to better fit the availability of renewables, we operate datacenters to address environmental equity as a broader issue. In fact, campuses worldwide. We are well on our way to reaching monetizing their energy flexibility and decreasing their those most affected by climate change are those who have this goal, as we began purchasing renewable energy via carbon footprint. This solution is being used at our with programs to reduce contributed the least to climate change. Renewable energy long-term power purchase agreements (PPAs) in 2013, and Swedish offices and, in the third quarter of 2020, we local air pollution, improve procurement can help address these inequities. have steadily signed more deals in subsequent years, announced that our new datacenter region in Sweden will In June 2020, we announced our largest power PPA to purchasing renewable energy across three continents. also rely on the solution—which is now available to air quality, and cut date with this in mind. Our 500MW PPA with Sol Systems Our approach to renewable energy has two core tenets: customers throughout the country via Vattenfall. carbon emissions. is a first-of-its-kind initiative, tying the purchasing of regional impact and additionality. We have focused on Piloting distributed generation renewable energy to environmental justice and equity in regional matching to operations, because where and We believe distributed energy generation has a key role under-resourced communities. This partnership: how you buy matters—the closer the new wind or solar to play in the transition to a zero-carbon grid. In 2020, • Prioritizes projects in under-resourced communities, farm is to your datacenter, the more likely it is those zero Microsoft launched a new project to pilot this work. We working with local leaders and prioritizing minority carbon electrons are powering it. Microsoft, as a result, is partnered with SSE Airtricity, Ireland’s largest provider of and women-owned businesses. sometimes a market driver, striking the first or the largest 100 percent renewable energy and a part of SSE Group, corporate PPAs in a state or region that was not to install and manage a large number of internet- • Provides at least $50 million for community-led grants previously viewed as a good market for renewables. We connected solar panels, which are connected via Azure and investments that support educational programs, also focus on additionality, using our capital to fund new IoT to Microsoft Azure. Software tools then aggregate job and career training, and programs that support projects that may not succeed without our investment. and analyze real-time data on energy generated by the access to clean energy and energy efficiency. We utilize on-site energy when it makes sense. For solar panels, allowing optimization and reduction of the • Ensures that community benefits are realized with example, we currently power 25 percent of our Silicon carbon footprint of electricity grids globally. accountability measures, including using third-party Valley campus from on-site photovoltaic panels. Grid-interactive energy storage batteries evaluators to quantify and document social and Our efforts go well beyond procurement because we Microsoft has successfully piloted, in partnership with environmental outcomes of the initiative. recognize that simply adding more renewables is Eaton and PJM Interconnection, grid-interactive energy Outside of the US, we are also using our procurement in insufficient. We are innovating ways to enable utilities to storage batteries in Virginia and Chicago. Utilizing support of climate equity. In the third quarter of 2020, on-board increasing amounts of renewables in an Eaton’s EnergyAware technology, we used a battery that Microsoft purchased the first-ever Peace REC (P-REC), issued effective and efficient way, so more people can benefit typically sits in our datacenter as a backup system, by Energy Peace Partners from Congolese solar developer from renewable energy, including the following: hooked it up to the grid to receive signals about when to Nuru’s newly commissioned 1.3MW commercial solar-plus- take in power, when to store it, and when to discharge to storage project in Goma, Democratic Republic of the Congo. 24/7 renewable energy matching solutions support stability, grid balancing, and integration of The purchase helped Nuru install and operate 35 mini-grid- In 2020, we launched a new 24/7 matching solution with renewable energy. With thousands of batteries as part of connected streetlights in the Ndosho neighborhood of Goma. Swedish energy company Vattenfall—a first-of-its-kind our backup power systems, this pilot demonstrates the approach that allows an hourly-matched supply of 100 potential to rapidly scale storage solutions, allowing percent renewable energy. Microsoft Azure IoT gives datacenters to support grid stability, furthering the renewable energy suppliers, like Vattenfall, real-time penetration of renewable energy. Following the data on their renewable energy and energy storage successful pilots, we are investigating the suitability of In our datacenters, we’re measuring and improving efficiency. further deployment at new projects in other geographies.