Microsoft signed three 20-year solar power purchase agreements with Japan's Shizen Energy

Microsoft wrapped up three new renewable energy deals with Shizen Energy, a Japanese clean power firm, as part of its ongoing effort to get electricity from sustainable sources.

The software maker agreed to three separate 20-year solar power purchase agreements with Shizen, the Japanese firm announced Friday. This marks the second round of deals between the two companies, coming two years after their initial partnership. The new contracts bring Microsoft’s total renewable energy commitment with the Fukuoka-based provider to 100 megawatts as per Bloomberg.

Asia-Pacific Renewable Energy Market Surges

Major corporations, particularly technology companies expanding their data center operations, have been racing to lock down clean electricity supplies to reduce carbon emissions across their operations. Long-term contracts between buyers and sellers for solar and wind energy have emerged as a preferred method. Last year, these types of agreements for offsite power sources in the Asia-Pacific region jumped 51% compared to the previous year, reaching 10.3 gigawatts.

The three solar facilities connected to Microsoft’s latest agreements with Shizen have secured their project financing and are situated in Japan’s Kyushu and Chugoku regions in the western part of the country. One facility is already producing power, while the remaining two are still being built.

Microsoft Invested $10 Billion in Renewable Energy with Brookfield

Microsoft first entered a long-term renewable energy agreement in Japan back in 2023, working with Shizen on that deal as well. Then in May 2024, Microsoft announced a massive deal with Brookfield Asset Management to invest over $10 billion in renewable energy development.

Under that agreement, Brookfield will deliver 10.5 gigawatts of renewable capacity between 2026 and 2030 across the United States and Europe. The companies called it the largest single electricity purchase agreement ever signed between two corporate partners. The 10.5 gigawatts is three times larger than the 3.5 gigawatts consumed by data centers in Northern Virginia, the world’s biggest data center market.

Microsoft aims to remove more carbon from the atmosphere than it produces by 2030. Since 2020, the amount of clean power the company has contracted has grown 18 times over, according to its most recent sustainability report.

Shizen Energy started operations in 2011 following the Fukushima nuclear disaster, when Japan began prioritizing solar and wind energy expansion. By 2024, the company had built 1.2 gigawatts of projects worldwide. Shizen recently signed another deal with Google for its data center facility in Chiba prefecture.

As Cryptopolitan reported millions of Americans are seeing their power bills shoot up because of AI data centers. The PJM Interconnection LLC, which manages the eastern U.S. power grid, just saw its supply costs surge by $7.3 billion in the latest auction, with AI server facilities accounting for almost half that increase. The grid serves roughly 67 million residents across 13 states.

A Wednesday report revealed that these data centers ate up 45% of total power supply costs in the summer auction.

When you look at the prior auction too, these facilities drove about two-thirds of the record-breaking prices. Put together, both auctions saw these AI buildings tack on $16.1 billion in extra costs. Things have gotten heated enough that Pennsylvania Governor Josh Shapiro floated the idea of pulling his state out of the regional grid altogether.

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