Key Impact Points:
- Microsoft will purchase up to 2.95 million tonnes of permanent carbon removals from Gaia starting in 2029
- First major offtake deal for a Waste-to-Energy carbon capture retrofit, advancing decarbonization in the sector
- Installation will expand district heating capacity, supplying heat to 10,000+ additional homes
Microsoft Backs Carbon Capture at Danish Waste-to-Energy Facility
Copenhagen Infrastructure Partners (CIP), through its Energy Transition Fund (CI ETF I), and Danish utility Vestforbrænding have signed a long-term carbon removal agreement with Microsoft via their joint venture, Gaia ProjectCo P/S. The deal secures Microsoft’s offtake of up to 2.95 million tonnes of permanent carbon removals starting in 2029.
Pioneering Retrofit for Waste-to-Energy Sector
The agreement is one of the first long-term, multi-year carbon removal offtakes from a Waste-to-Energy (WtE) facility fitted with carbon capture and storage (CCS) technology. The captured CO2 will be certified as Carbon Removal Units (CRUs), reflecting only the biogenic portion of emissions, determined via the radiocarbon method, and net of process emissions. The project enables Gaia to capture and store up to 500,000 tonnes of CO2 annually, in line with EU Waste Framework Directive standards that ensure emissions come from unavoidable residual waste.
“This agreement, through Gaia, marks the first agreement between CIP, through CI ETF I, and Microsoft and we are optimistic it represents the start of a long-term relationship between the parties,” said Nikos Samaritis, Managing Director, CI ETF I. “The agreement is also significant for CIP as it represents the first offtake transaction by CIP for environmental attributes (e.g CRU), signaling CIP’s growing role in the development of new environmental products and technologies.”
Heating Homes and Advancing Compliance
Installing CCS technology will also expand district heating capacity, supplying clean heat to over 10,000 additional homes. The project helps demonstrate how carbon capture from WtE facilities can contribute meaningfully to Europe’s decarbonization strategy while still prioritizing waste prevention and recycling.
“The offtake agreement with Microsoft is a defining milestone for the Gaia project,” said Steen Neuchs Vedel, CEO, Vestforbrænding. “It not only validates the technical and commercial maturity that Vestforbrænding has worked hard to establish but also reflects how this maturity has been further strengthened through CIP’s entry into the project.”
Momentum Builds Ahead of Danish CCS Tender
Vestforbrænding has been advancing its CCS efforts since being named runner-up in the Danish Energy Agency’s 2023 CCS subsidy tender. The project has since matured through the creation of Gaia with CIP, a long-term flue gas agreement, and the securing of nearly all key permits, including the Environmental Impact Assessment. The Microsoft offtake follows Gaia’s prequalification for Denmark’s national CCS Tender, with the joint venture preparing a bid for state aid in December.
“Gaia’s approach of retrofitting waste-to-energy facilities—in combination with the enforcement of the EU Waste Framework Directive—helps unlock more carbon-free energy while ensuring waste prevention and recycling remain top priorities,” said Brian Marrs, Senior Director of Energy & Carbon Removal at Microsoft. “We’re pleased to see experienced developers like Copenhagen Infrastructure Partners, through its Energy Transition Fund entering the carbon removal market and look forward to ongoing collaboration.”
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