GLOBAL tech giant Microsoft has made what is claimed to be the largest exchange of carbon credits ever, with a Brazilian investment bank saying it has agreed to a 19-year deal worth 8m carbon credits.

The company has also been purchasing soil carbon credits, with an American company saying it has sold 40,000 credits to Microsoft this week.

The values of both deals are unknown. However, given they are on voluntary carbon markets it is likely to be worth significantly less than the Australian Carbon Credit Unit price, which opened today at $34.25 according to Jarden.

ACCU markets are a ‘compliance market’ with laws in place forcing demand, something voluntary markets don’t have.

Microsoft is no stranger to highly publicised forays into the carbon market, partnering with a group of Australian cattle companies, including Wilmot, in 2019 to purchase soil carbon credits. Microsoft is aiming to become carbon negative by 2030.

Its latest reported carbon transaction is with Brazilian investment bank BTG Pactual’s forestry arm called the Timberland Investment Group. TIG made the announcement earlier this week saying it aimed to restore about 135,000ha of natural forests in deforested landscapes.

Microsoft has been providing yearly updates in its procurement of carbon credits, with its white paper last year saying it wanted to make sure reforestation projects had biodiversity benefits and that it needed to make sure it was not planting monocultures to reach its goals.

According the TIG press release, the project has a conservation focus and will involve hundreds of different plant varieties and native seedlings.

“This project exemplifies how reforestation and restoration can deliver carbon removal at scale while supporting local communities and restoring vital ecosystems,” Microsoft’s Brian Marrs said.

“This approach will attract investment to the conservation space and help scale carbon removal in line with what climate science demands.”

Microsoft continues to invest in soil carbon

Microsoft has also made a significant investment in soil carbon, with a US company called Indigo Ag announcing a sale of carbon credits to Microsoft this week. Indigo Ag says it sold 40,000 soil carbon credits through a registry called Climate Action Reserve.

“Soil organic carbon restoration is vital to the future of food systems, economies and climate change mitigation. We are pleased to collaborate with Indigo Ag to advance both the adoption of regenerative agriculture practices and the soil organic carbon scientific evidence base,” Mr Marrs said.

In Australia, Microsoft’s carbon credit pursuits are best known for a soil carbon deal it made with a group of Australian cattle companies, including Wilmot, through an American scheme called the Regen Network.

In the wake of the deal, a group of scientists criticised the methodology used to generate the credits and said the estimated gains were far too optimistic.

Since making the Australian deal in 2019, Microsoft has continued to cautiously back soil carbon as a part of its carbon negative goals.

It released a white paper in 2021, which referenced the Wilmot deal and said there was significant potential in soil carbon.

“Conservation tillage, cover cropping, crop rotation, and improved cattle management are a few practices that can increase carbon storage in soil,” the paper said.

“As with forests, we also recognize that soil projects are inherently impermanent and that sequestered carbon can be released to the atmosphere, such as through erosion, tillage, or land use changes.

“The soil carbon market is relatively immature, and the certainty of soil carbon removal estimates is dependent on rigorous and appropriately designed measurement approaches.”

Since the Wilmot deal, Microsoft partnered with a crop grower in the US to develop and purchase soil carbon credits through improved cropland management.

Earlier this year, it purchased soil carbon credits from a Texan company called Grassroots Carbon – which was building soil carbon through rotational grazing.

Australian companies continue to generate soil carbon credits

In Australia, more cattle companies are being issued Australian Carbon Credit Units for increasing soil carbon.

A producer from Walcha, New South Wales, was issued with credits earlier this year, followed by a Central Qld Brahman breeding operation.

The latest has been South Australia-based Koolah Angus, who was 641 ACCUs from a project it signed up with Agriprove.

Koolah’s Derek Walter said building soil carbon aligned with production objectives.

“Regenerative agriculture isn’t a matter of removing management, it’s about improving our management of the natural resources we have by taking positive action, and not depleting the carbon reserves in our soils.

“Weeds are indicators of the physical and chemical changes taking place in the soil, and the composition of our pastures has changed significantly since starting the carbon project.

“We used to spend a lot of our time spraying and managing weed burden on the farm. Since switching to a regenerative agriculture model this is less of a problem for us now.

“Farming has always been a team effort, and we need everyone to work together because the more data we can collect, the better we can analyse it for positive agricultural outcomes.”