Microsoft Pauses Carbon Removal Purchases, Shaking DAC Industry

Microsoft, which controls approximately 80% of all contracted carbon removal purchases globally, announced a pause on future carbon removal purchases in April 2026, sending shockwaves through the nascent direct air capture (DAC) industry. The company — which has pledged to become carbon-negative by 2030 — said the pause was an 'adjustment' rather than a permanent abandonment, but the move raised serious concerns about the viability of DAC startups heavily dependent on Microsoft contracts. Compounding the concern: Microsoft's own emissions had risen 23.4% since 2020 despite its public climate commitments, driven by energy-intensive AI data center buildout. The UN's 2022 climate report suggests nations may need to remove up to 11 billion metric tons of CO₂ annually by 2050 to limit warming to 2°C.