On January 15, Indigo Carbon PBC announced one of the largest soil carbon transactions to date, marking a major milestone for regenerative agriculture in the voluntary carbon market. Under a 12-year agreement, Microsoft will purchase 2.85 million soil carbon credits generated through the Carbon by Indigo program, a large-scale, U.S.-based initiative focused on delivering high-integrity carbon removals.
This agreement underscores the increasing confidence of large corporate buyers in nature-based carbon removal pathways, particularly those that integrate climate impact with tangible on-the-ground benefits for farmers and ecosystems.
Third Transaction Strengthens Microsoft’s Carbon-Negative Path
Microsoft’s FY24 climate data reflects a 23.4% increase in overall emissions compared to its base year, largely due to rapid business expansion. Despite this, Microsoft retired 595,922 metric tons of carbon removals to meet its annual carbon-neutral target.
The latest purchase represents the third carbon credit transaction between Microsoft and Indigo. It follows earlier deals for 40,000 tonnes of credits in 2024 and 60,000 tonnes in 2025. Together, these agreements underscore Microsoft’s long-term strategy to meet its commitment to become carbon negative by 2030.
Looking ahead, Microsoft has contracted for nearly 22 million metric tons of carbon removals to be delivered over the next 15 years or more. This includes 2.8 million tons expected in FY30, the company’s carbon-negative target year, with additional volumes planned beyond FY31.
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Indigo Ag Strengthens High-Integrity Carbon Removal Supply
The broader regenerative agriculture market continues to gain momentum.
- Research showed that, valued at $1.52 billion in 2025, the market is projected to grow from $1.76 billion in 2026 to around $5.77 billion by 2034, reflecting a CAGR of 15.97%.
Practices such as cover cropping, rotational grazing, reduced tillage, and compost application improve soil carbon levels and microbial diversity. As voluntary carbon markets mature, regenerative agriculture is emerging as a durable climate solution and a scalable economic opportunity for farmers.
For Indigo, the deal further cements its leadership in scaling verified soil carbon removals, demonstrating that regenerative agriculture can deliver credits at volumes large enough to meet enterprise-level demand.
Regenerative Agriculture: Climate Impact Plus Farm Productivity
Governments and climate institutions increasingly recognize regenerative agriculture as a powerful carbon removal tool.
- Research suggests these practices could remove more than 3.5 gigatons of CO₂ equivalent annually, while also improving soil health, increasing crop resilience, and stabilizing yields.
Beyond carbon, regenerative practices deliver critical co-benefits. They enhance water infiltration, reduce erosion, and support water conservation—key advantages as drought and water scarcity intensify across agricultural regions. These outcomes also strengthen rural economies by improving long-term farm productivity.
New Revenue Streams for Farmers
At a time when farmers face rising costs, climate volatility, and market uncertainty, the Microsoft-Indigo agreement delivers meaningful financial incentives. By rewarding farmers for adopting regenerative practices, the deal improves farm resilience while creating new, non-government revenue streams.
Indigo currently works with farmers across more than eight million acres and has paid $40 million through its programs to date. These payments are independent of government subsidies, offering farmers greater financial flexibility and stability.
High-Integrity Credits Meet ICVCM Core Carbon Principles
Credit integrity is a defining feature of the agreement. It is among the first soil carbon deals to include credits approved under the Integrity Council for the Voluntary Carbon Market’s (ICVCM) Core Carbon Principles.
Indigo has issued 927,296 carbon removal and reduction credits under CAR1459 using the Climate Action Reserve’s Soil Enrichment Protocol. The company relies on peer-reviewed science, field data, remote sensing, and machine learning to measure and verify soil carbon outcomes.
To address permanence risks, Indigo has added safeguards across the 40-year durability period agreed with Microsoft, complementing the protocol’s 100-year monitoring and reversal compensation requirements.
On an end note, Meredith Reisfield, Senior Director of Policy, Partnerships, and Impact at Indigo, said:
“Microsoft’s purchase highlights the transformative power of regenerative agriculture to support watersheds, support farming communities, and advance global net-zero goals. Indigo is a proud catalyst of today’s soil carbon market, with our long-standing history of farmer collaboration and proven impact, already saving 64 billion gallons of water and issuing nearly one million tonnes of CO2e carbon removal credits since 2018.”