By Abbas Nazil
Microsoft and carbon markets platform Rubicon Carbon have announced a major new agreement to deliver two million Afforestation, Reforestation, and Revegetation (ARR) carbon removal credits to Microsoft over the next nine years.
The credits will be sourced from a smallholder farm-focused forestry project in Uganda, operated by Kijani Forestry, marking the first deal completed under a broader framework agreement launched in 2025.
Under the 2025 framework, Rubicon Carbon is set to facilitate the purchase of 18 million tonnes of high-quality carbon removal credits for Microsoft, with a focus on ARR projects worldwide.
The new agreement is expected to support the Smallholder Farmer Forestry Project by Kijani Forestry, which works with over 50,000 smallholder farmers to establish income-generating woodlots on degraded land.
Through the deal, farmers will be able to earn revenue from carbon credits within a year of planting the trees, and later generate additional income from sustainable timber and charcoal production once the trees mature.
Tom Montag, CEO of Rubicon Carbon, explained that structured finance can unlock large-scale climate action, emphasizing that the long-term capital provided to Kijani’s project will both deliver measurable climate impact and expand economic opportunities for local communities.
Kijani Forestry has planted 30 million trees to date in partnership with its farmers, with projections indicating household incomes could increase by more than 600 percent per acre planted.
Quinn Neely, Co-Founder and CEO of Kijani Forestry, noted that the collaboration with Microsoft and Rubicon Carbon will enable the project to reach more farmers, restore more land, and accelerate positive climate outcomes.
This agreement adds to Microsoft’s growing portfolio of carbon removal commitments, which already includes several large-scale afforestation and reforestation deals, such as a seven million ton agreement with Chestnut Carbon and a 3.5 million ton deal with re.green announced last year.
Phillip Goodman, Director of Carbon Removal at Microsoft, said the partnership supports farmer livelihoods while restoring ecosystems in Northern Uganda, highlighting that the framework with Rubicon Carbon streamlines contracting and ensures high-quality nature-based removals.
The deal exemplifies the increasing role of corporate investment in carbon markets and demonstrates how public-private partnerships can combine environmental sustainability with economic development.
By providing predictable carbon revenue and supporting sustainable land management, the agreement helps strengthen community resilience while contributing to global climate mitigation efforts.
Microsoft’s continued investment in nature-based carbon removal reflects a growing trend among corporations to integrate environmental responsibility into their business strategies while meeting ambitious climate commitments.
The partnership with Kijani Forestry signals a model for leveraging local farmer participation in carbon markets, combining financial incentives with environmental stewardship to scale climate solutions effectively.