Microsoft's AI Push Puts Its Carbon-Neutral Goal At Risk, Says President Brad Smith

Microsoft Corp‘s MSFT ambitious push into artificial intelligence is jeopardizing its goal of becoming carbon-negative by 2030, according to President Brad Smith.

What Happened: Microsoft’s AI strategy, which has seen a significant expansion since the company’s $1 billion investment in OpenAI in 2019, has led to a substantial increase in the company’s emissions, reported Bloomberg.

Smith told Zero host Akshat Rathi that the company’s total emissions in 2023 were approximately 30% higher than in 2020. This increase is largely attributed to the company’s AI investments.

“In 2020 we unveiled what we called our carbon moonshot. Our goal of being carbon negative by 2030. That was before the explosion in artificial intelligence. So in many ways, as I say, across Microsoft, the moon has moved. It's more than five times as far away as it was in 2020. If you just think about our own forecast for the expansion of AI and its electrical needs,” Smith said.

“So I think the right way to think about it in the first instance is — call it benefits and costs — or you know, the good that we think AI will do for the world versus the impact on the environment,” Smith added.

Microsoft’s AI strategy has been instrumental in its rise to becoming the world’s most valuable company, with a valuation exceeding $3 trillion. However, this growth has come at a cost to the company’s environmental goals.

The company has stated that it remains committed to its environmental goals and is exploring various avenues to achieve them. Smith emphasized the potential positive impact of AI on the world, which he believes will outweigh its environmental impact.

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Why It Matters: Microsoft’s AI push has also raised questions about its environmental impact. The company’s increasing emissions are a cause for environmental concern, especially given its ambitious carbon-negative goal, according to the report.

At the recent Build Conference, Microsoft introduced new AI-powered features that have further solidified its position as a leader in the AI space. However, the company’s increasing emissions raise questions about the sustainability of its AI strategy.

Smith’s comments also come in the wake of concerns about Microsoft’s AI strategy raised by analysts. According to Gene Munster, Microsoft’s future in the AI space is in the hands of OpenAI, and the company is not in control of its AI destiny like Google and Meta.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote