Tech giant Microsoft announced it has purchased 1.5 million carbon credits from a Brazilian startup, funding a project to reforest degraded parts of the Amazon rainforest.
The company did not disclose how much it paid in the transaction, but it is the company’s biggest foray so far into carbon credits anywhere in the world, forming part of its goal to become carbon neutral by 2030.
The Brazilian startup in question, Mombak, has pledged to plant more than 100 species of native trees in degraded portions of the Amazon in the northern state of Pará, covering a total area equivalent to five times the size of Manhattan.
The state of Pará is the biggest deforestation hotspot in Brazil’s so-called “Legal Amazon,” and has been since 2006. Governor Helder Barbalho is in Dubai for the UN Climate Change Conference (COP28) and is seeking to change his state’s image from deforestation villain to climate pioneer, announcing a public program for individually tracing cattle heads.
Mombak was founded in 2021 by Gabriel Silva (formerly CFO of Nubank) and Peter Fernandez (former CEO of ride-hailing firm 99). It claims to develop scaled solutions that remove carbon from the atmosphere in the most effective ways.
“We discovered that the best opportunity we have to [remove carbon] today is by reforesting, and it is in Brazil,” Mr. Fernandez told Um Só Planeta, while attending COP28.
“We try to build the markets we buy from,” said Brian Marrs, Microsoft’s senior energy and carbon removal officer. “We hope this will be a model for the future.”
In October, Brazil’s Senate approved a bill creating a regulated carbon market, though crops and livestock — which emit the most CO2 in the country — were left out of emissions cap rules. The proposal was since sent to the House and is not yet ready for a vote.
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