Microsoft is taking innovation in sustainability to a new level: the company has begun construction on its first data centers using engineered wood, a move aimed at drastically reducing emissions associated with steel and concrete, materials that have traditionally contributed significantly to the carbon footprint in the construction sector.
Wooden Data Centers: Cloud Innovation with an Eco-Friendly Focus
In the heart of Northern Virginia, Microsoft is implementing a hybrid structure that combines cross-laminated timber (CLT), steel, and a minimal amount of concrete. This prefabricated wood technology, widely used in Europe and gaining traction in the United States, offers notable environmental advantages: the new data centers will reduce embedded carbon footprints by about 35% compared to traditional steel construction and 65% compared to prefabricated concrete.
CLT is fire-resistant and, due to its manufacturing process, requires less energy and produces fewer emissions than steel or cement. Additionally, using sustainable wood contributes to a circular economy, as it is a renewable material that stores carbon throughout its lifespan.
Climate Goals and Progress in Sustainability
In 2020, Microsoft set one of the most ambitious climate goals in the sector: to be carbon negative by 2030 and eliminate all carbon emissions since its founding in 1975 by 2050. Over the past three years, the company has managed to reduce its direct emissions by 6.3%, although rapid growth in data centers has increased indirect emissions by nearly 31%. These figures underscore the urgency of transforming the way technological infrastructure is built.
To that end, the company has launched several initiatives, such as updating contracts to require low-carbon materials, investing in new technologies—like concrete that absorbs CO₂ or steel produced with green hydrogen—and promoting the use of CLT on an industrial scale. Moreover, Microsoft is involved in climate innovation platforms and funds, investing over $761 million in transformative impact solutions and direct purchasing agreements for sustainable materials.
Industry Challenges and Microsoft’s Role as a Market Mover
Reducing emissions in the construction supply chain is one of the major global challenges, as steel accounts for about 7% and cement for 8% of global emissions. Despite the higher initial cost of laminated wood and the lack of widespread experience in its use, adoption in large projects like data centers is economically viable due to shorter construction times, reduced skilled labor needs, and the logistical efficiency of prefabricated materials.
Microsoft, as one of the largest data center operators in the world, is positioned to "push" the market toward faster adoption of these materials, creating sufficient demand for these technologies to scale and lower in price.
Engineered Wood: Technical and Environmental Advantages
The cross-laminated timber used, sourced from sustainable suppliers, is made by gluing layers of wood together in alternating directions and pressing them into solid panels. This material, in addition to being lightweight and strong, performs better in fire resistance than steel (as it creates a layer of char that protects the structure) and significantly reduces the need for steel and concrete in floors and roofs.
The pilot experience in the new data centers in Virginia will serve as a durability and efficiency test before more widespread adoption in future Microsoft infrastructures.
Toward a Greener and More Sustainable Cloud
Microsoft’s push for data centers made from laminated wood marks a milestone in industrial architecture and the ecological transformation of the cloud sector. The company’s example, combined with its ability to influence suppliers and customers, could accelerate the adoption of low-carbon materials and processes across the technology industry.
As Jim Hanna, Microsoft’s Director of Data Center Engineering Sustainability, puts it: “We need to think about systems across the entire value chain of the materials and equipment that power our data centers. It’s a complex challenge, but it’s not impossible.”
With this commitment to renewable materials and climate innovation processes, Microsoft establishes itself as a global leader in the decarbonization of digital infrastructure, demonstrating that the future of the cloud can—and must—be built on more ecological and sustainable foundations.