Utilizing our voice to advance carbon and electrical energy coverage

We acknowledge that Microsoft and the broader non-public sector have an vital function to play in advocating for an efficient and progressive sustainability coverage. After we introduced our dedication to changing into carbon damaging in 2020 by 2030, we pledged to make use of our voices on public coverage points to assist advance world decarbonization efforts.

As we speak, we’re publishing a quick on carbon and electrical energy coverage to share the priorities and rules guiding Microsoft’s coverage assist work world wide. The rules we set are based mostly on reaching tangible outcomes, enabling a versatile slightly than one-size-fits-all strategy, and recognizing the important function of digital applied sciences as we develop market alternatives for all. Huh. We’re releasing these two coverage briefs collectively to spotlight the integral and complementary function that electrical energy coverage performs in addressing local weather change. We additionally acknowledge that there are vital power points that transcend local weather change comparable to entry to electrical energy, affordability and environmental justice for all. Equally, there are problems with carbon that transcend power. As we sort out these points in parallel, we’re aware that our coverage actions will must be expanded sooner or later and take into account these coverage briefs as the inspiration for future work on points comparable to water and waste .

We perceive that public insurance policies play an vital function in stimulating the financial and social transition wanted to handle local weather change and in constructing the inspiration for markets to develop and ship progressive items, companies and expertise to attain that transition. Will carry out Nonetheless, there’s a rising hole between the tempo of desired coverage outcomes and the financial and scientific indicators that more and more present local weather impacts. To bridge this hole and help communities and firms of their efforts to attain their local weather guarantees, governments world wide have to speed up coverage motion.

Over the previous two years, we’ve got advocated for local weather and power funding as a part of current US infrastructure and local weather legal guidelines, a powerful and constant framework for local weather disclosure necessities by the US Securities and Alternate Fee (SEC), and a Complete European Union (EU) decarbonization plan, simply to call a number of. As we develop our assist efforts, we are going to use the next priorities and rules to information our engagement on carbon and electrical energy coverage world wide:

Carbon Polisi

Over the previous decade, a median of not less than 170 new climate-related legal guidelines have come into pressure world wide yearly. A number of overlapping elements are driving each the tempo and path of climate-related insurance policies. Chief amongst them is stress on policymakers from the general public, NGOs, and firms, in addition to more and more seen indicators of a altering local weather (together with wildfires, droughts, warmth waves, and extreme storms and floods), which Close by are driving a excessive sense of urgency. length motion. As well as, traders and clients are more and more concerned with firms offering extra climate-friendly items and companies.

Insurance policies to mitigate local weather change by addressing greenhouse gases (GHGs; sometimes called carbon in shorthand) may be organized into three important areas: carbon reporting, carbon discount and carbon removing.

Carbon Reporting: Whereas reaching world net-zero emissions requires many various steps, all of them depend on a standard foundation that ensures that carbon emissions are globally correct, constant, interoperable and dependable. technique is measured. If governments, NGOs and firms world wide don’t measure carbon emissions in the identical means, they’re prone to discuss to one another, create confusion, and in the end set unrealistic expectations concerning the tempo of progress.

We assist new company carbon disclosure and buy reporting insurance policies that: (1) drive constant, sturdy and interoperable GHG reporting metrics; (2) selling complete however versatile company GHG disclosure; and (3) make the most of new applied sciences to calculate and monitor emissions and local weather impacts.

Carbon Discount: To attain net-zero emissions by mid-century, governments have to create extra insurance policies to scale back carbon emissions. These insurance policies will range in several geographic areas. Some approaches will deal with economy-wide options comparable to an emissions buying and selling scheme (ETS) – or “cap and commerce” – by which the federal government points or auctions licenses for particular industries to emit a specific amount of GHG emissions. , and with the extra capability the recipient can commerce the license to those that expect greater than their allowance. Different insurance policies will goal particular sectors comparable to energy era, constructing, transportation, aviation and agriculture, with governments utilizing totally different coverage levers to scale back the footprint of every sector. The trail to net-zero emissions is strongly influenced by the stage of a rustic’s financial improvement and pure useful resource combine. Improvements in financing mechanisms, know-how design and deployment approaches, and participatory fashions may also help nations within the International South, which can be within the early levels of the local weather mitigation and adaptation journey, to maneuver rapidly away from conventional carbon-intensive infrastructure.

We assist new carbon discount insurance policies that: (1) assist a complete, results-based, multi-sectoral toolkit; (2) doubling down on grid decarbonization whereas encouraging discount in hard-to-absorb areas; and (3) Design for Robust Development.

Carbon Elimination: We’re seeing an growing urgency in rising the carbon removing market. An August 2021 report by the Intergovernmental Panel on Local weather Change (IPCC) calls on the world to make speedy progress and instantly take away an space of ​​10 gigatonnes of carbon dioxide (or its equal) yearly by the second half of this century. Importantly, it shouldn’t be a alternative for unprecedented carbon emissions reductions, however consistent with it. Authorities coverage can play an vital function in making a market for prime quality and sustainable carbon removing.

We assist new carbon removing insurance policies that concentrate on: (1) clear accounting and driving top quality requirements; (2) prioritizing extremely sustainable options: and (3) involving native and affected communities,

electrical energy coverage

Electrical energy is a enabler of financial development, social welfare, higher well being and different constructive social outcomes. In an more and more interconnected, technology-driven world economic system, the demand for dependable electrical energy will proceed to develop.

There are three dimensions to this energy requirement which can be vital to contemplate.

First, regardless of the inevitable function of electrical energy, we nonetheless reside in a world the place greater than 770 million folks reside with out entry to electrical energy (principally in Africa and Asia). Financial improvement in these areas requires the event of a dependable electrical grid. Second, the diversification of renewable and carbon-free power sources and the modernization of electrical energy targets are important to assembly the world’s decarbonization objectives. As we speak, fossil fuels produce 61% of electrical energy within the Americas, about 70% within the Asia Pacific area, and a good portion on different grids world wide. Third, entry to renewable power on a worldwide foundation has change into important to Microsoft’s personal enterprise. The datacenters that energy our world cloud companies depend upon a dependable, constant, versatile and versatile provide of electrical energy in each nation the place we function. On the similar time, Microsoft has a few of the world’s most formidable local weather and clear power commitments, together with our dedication to be carbon damaging by 2030 and the acquisition of sufficient renewable power to cowl 100% of our electrical energy use by 2025.

In response to McKinsey & Firm, world electrical energy demand will triple by 2050, pushed by each electrification and improved residing requirements. Current analysis means that, in the USA alone, electrical energy provides might want to develop by 60% by 2030 and triple in measurement by 2050. The disruptions related to Russia’s invasion of Ukraine have highlighted the significance and advantages of low cost power safety. Energy era that doesn’t depend upon gasoline to make sure the reliability of the European grid. Snow storms, fires and warmth waves have prompted huge tensions world wide. These grids are coming below stress on the proper time that they’re changing into a necessary basis of change to impress the economic system and enhance entry to carbon-free power – underscoring the necessity for pressing motion.

Our public coverage advocacy relating to the electrical grid is centered on three pillars. They search to assist an expanded, sturdy, dependable and carbon-free grid by: (1) accelerating the transition to scrub electrical energy era; (2) modernization and enchancment of grid infrastructure; and (3) selling a equitable power future.

stability graphic

Accelerating the transition to scrub electrical energy era: To energy our rising operations and develop carbon-free provide to energy native grids world wide, we use insurance policies that promote a various zero-carbon power combine for a dependable, resilient and resilient grid. are supporting. This consists of using wind, photo voltaic, hydro, nuclear and inexperienced hydrogen power. We’re additionally supporting insurance policies that allow the grid to reply flexibly to modifications in provide and demand – for instance, sending zero-carbon electrical energy on demand to the grid with excessive ranges of variable renewable power Utilizing storage know-how for We consider that essentially the most acceptable coverage design – regulatory caps, clear power requirements, tax incentives, subsidies and/or public procurement – ​​can range significantly between nations.

We assist insurance policies that: (1) promote a various zero-carbon power combine for a dependable, resilient and resilient grid; (2) Replace the electrical energy market design and value indicators to develop participation; and (3) advancing R&D investments to ship the clear power applied sciences of the longer term.

Modernization and Enchancment of Grid Infrastructure: Along with including clear power capability, grid administration should change into extra dynamic as giant quantities of renewable power and distributed assets are deployed and carbon-emitting power sources are retired. As zero-carbon assets are added to the grid at an accelerated fee, the community of wires that may energy properties and companies should additionally develop considerably.

We assist insurance policies that: (1) Prioritize and Useful resource Transmission Planning and Sighting to develop power distribution; (2) simplifying the allowing course of to speed up clear power grid interconnection; and (3) advancing using digital know-how, together with AI, to handle, optimize, stabilize and shield the grid.

Encouraging a equitable power future: Lastly, the clear power transition requires a brand new technique for group and stakeholder engagement that ensures the participation of those that have traditionally been affected by carbon-intensive power improvement and who profit most from the enlargement of the electrical grid. stand to be. There is a chance to implement new zero-carbon power greatest practices in nations which can be constructing their grids for the primary time.

We assist insurance policies that: (1) assist and develop the voice of affected communities; (2) Design power for the same debut within the International South; and (3) implementing measures to maintain the price of electrical energy inexpensive and equitable.


Public coverage will play an vital function within the world net-zero transition. Microsoft has a storied historical past of environmental sustainability motion and advocacy, and we see this as a chance to make use of our duty and our voice to assist insurance policies that we consider could have the best affect.

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Tags: carbon impartial, local weather change, internet zero, sustainability, sustainable improvement objectives

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