'Greenwashing' Concerns Rise as Microsoft (NASDAQ:MSFT) Pushes Green Ambitions
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Microsoft's focus on artificial intelligence (AI) has proven a particular sticking point. AI requires huge amounts of computing power, and thus electricity, to work. And while new data centers, backed up by whole new electric-generation options, are coming online, Microsoft still insists it can be a force in AI but still be green.
In fact, Microsoft swears it will be 'carbon-negative' by 2030, which means that, in five years, Microsoft will officially pull more carbon out of the atmosphere than it emits. With Microsoft planning multiple power plants' worth of emissions, the question of 'how' leaps to the forefront, and one of the unfortunate answers that follows is 'greenwashing,' a kind of accounting wizardry that allows a company to look green even when it is not. One such measure involves a contract with Vaulted Deep, a company making carbon credits by burying, and effectively warehousing, vast quantities of human waste.
Pushing for Carbon Neutralization
And indeed, Microsoft is ramping up its efforts to make itself look green even as it builds electrical generation power on par with small town use. One report noted that the market has produced about 37 million tons of 'durable carbon credits' that have been purchased since 2019. Of that 37 million, 30 million of those have been bought by Microsoft itself.
By way of comparison, Amazon (AMZN) bought 250,000 tons. However, with Microsoft clearly buying in on just about any carbon credit that crops up, it does suggest that there could be a booming industry ahead in producing these carbon credits so Microsoft and its contemporaries can carry on with AI development and building electrical plants at a scale not seen since the Rural Electrification Act.
Is Microsoft a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MSFT stock based on 34 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 26.96% rally in its share price over the past year, the average MSFT price target of $623.34 per share implies 18.75% upside potential.
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