Amazon’s carbon emissions fell last year

Amazon’s carbon emissions declined slightly in 2023 after the company increased its purchases of renewable energy and reduced pollution from construction, equipment and furnishings, according to its latest sustainability report.

In 2019, Amazon pledged to achieve net-zero carbon emissions by 2040. Despite that goal, its carbon emissions rose dramatically shortly thereafter — from about 51 million metric tons of CO2 in 2019 to more than 71 million metric tons in 2021. The company’s carbon footprint now appears to have decreased somewhat over the past few years, decreasing by 3 percent in 2023 to just under 69 million metric tons of CO2.

To put that in context, Amazon’s carbon footprint last year was roughly equal to the annual CO2 emissions from 184 gas-fired power plants. And the company still emits about 34 percent more carbon pollution than it did in 2019, when it made its climate pledge. But it’s worth noting that Amazon’s emissions fell slightly in a year when other tech giants’ pollution skyrocketed amid the explosion of new AI tools.

Amazon said the decline is mainly due to cleaning up carbon emissions from electricity use and indirect supply chain emissions, which fell by 11 percent and 5 percent, respectively. The company also announced that it had achieved its goal of covering 100 percent of its electricity consumption with renewable energy by 2023, seven years ahead of its 2030 deadline.

Breaking down what “match” means gets a little complicated, but it’s important for understanding each company’s clean energy goals. Simply put, there’s not enough renewable energy online yet to meet global climate goals, and siphoning off what’s available to meet one giant company’s clean energy goals would be unlikely to be feasible. Plus, when a company plugs into the grid, it doesn’t control whether the electricity it uses comes from a solar farm or a fossil fuel plant. Instead, companies typically pay to “match” their energy usage with Renewable Energy Certificates (RECs) designed to support renewable energy projects.

The quality of these RECs makes a difference. RECs may become so cheap that they will no longer be a sufficient source of income to encourage new clean energy projects. As a result, many companies overestimated the carbon reductions they would make through RECs, a study published in 2022 found. And what is really needed to stop climate change is new, additional sources of renewable energy.

To achieve this, other companies, including Microsoft and Google, have set goals to match their electricity consumption with locally generated clean energy on an hourly basis (rather than annually), supporting a future in which there is enough renewable energy to rely on 24/7 on any grid a company connects to.

Another alternative is to enter into a power purchase agreement (PPA), a long-term agreement to support the development of a clean energy project and/or purchase the electricity from it. Amazon is the largest corporate buyer of renewable energy, buying more solar and wind power through PPAs than Google and Microsoft combined, according to BloombergNEF.

By comparison, Google and Microsoft saw their greenhouse gas emissions rise by about 13 percent and 20 percent, respectively, last year as they infused AI into their products and services. Like Amazon, they’ve seen bigger increases since setting climate goals a few years ago. Microsoft’s carbon footprint was 30 percent larger in fiscal 2023 than in 2020, according to its latest sustainability report. Google’s carbon emissions were 48 percent higher in 2023 compared with 2019. Amazon is also bringing AI to Alexa and other services, but is reportedly struggling to catch up with other big players in the AI ​​race.

As Amazon noted, emissions from capital goods fell by 13% last year. Bloomberg. That includes things like building construction and new servers, vehicles and other equipment. The company’s capital spending fell by about $10 billion in 2023, Bloomberg reports. The company has been growing during the covid pandemic, which has caused carbon emissions to skyrocket. But as storage and data center costs have fallen, carbon emissions are also falling.