Microsoft has signed a deal with regenerative agriculture firm Indigo Carbon to purchase 2.85 million soil carbon removal credits, generated by a project in the US.

The deal, which is the third between the two companies, will be delivered over a 12-year period. The companies signed their first deal together in June 2024, in which Microsoft committed to purchasing 40,000 credits. They followed this up in May of last year with a 60,000 credit purchase.

"Microsoft is pleased by Indigo's approach to regenerative agriculture that delivers measurable results through verified credits and payments to growers, while advancing soil carbon science with advanced modeling and academic partnerships. Indigo is strengthening the carbon market through their commitment to enhancing project quality, championing the improvement of third-party standards, and producing high-integrity carbon removal credits," said Phillip Goodman, director of Carbon Removal at Microsoft.

Established in 2013 and operating in 14 countries worldwide, Indigo’s soil-regeneration carbon-removal process works by paying farmers to adopt regenerative practices. The practices, which include cover cropping, reduced tillage, and crop rotation, pull CO2 directly from the atmosphere and store it as organic matter in the soil.

Indigo then measures changes in soil carbon using a combination of soil sampling, farm data, and scientific modeling, with results independently verified under recognized carbon market standards. Verified gains are issued as carbon removal credits, each representing one ton of CO2 removed.

Proponents of the method claim it can remove more than 3.5 gigatons of CO2 equivalent each year, improve soil health, increase crop resiliency and yields, and scale local investment.

The latest agreement with Microsoft is not only one of the biggest soil carbon deals to date but also one of the first to include credits approved under the Integrity Council for the Voluntary Carbon Market's (ICVCM) Core Carbon Principles. To date, Indigo has issued 927,296 carbon removal and reduction credits from its CAR1459 project, using the Climate Action Reserve's Soil Enrichment Protocol.

"Microsoft's purchase highlights the transformative power of regenerative agriculture to support watersheds, support farming communities, and advance global net-zero goals," said Meredith Reisfield, senior director of Policy, Partnerships, and Impact at Indigo. "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."

The removal deal is Microsoft’s second in 2026 so far. Earlier this week, the company announced the purchase of two million carbon removal credits from Rubicon Carbon, generated by an afforestation project in Uganda.