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Microsoft headquarters in Redmond, Wash. (Microsoft Photo / via Getty Images)

A deal allowing Microsoft to directly purchase clean energy to power its Redmond, Wash., headquarters campus has been approved by the Washington Utilities and Transportation Commission (WUTC).

Microsoft and Puget Sound Energy (PSE) announced the agreement Thursday, which, according to a news release, is the result of several years of collaborative work between the company and the utility provider. It covers approximately 80 percent of Microsoft’s total energy load in the Puget Sound area. The remaining 20 percent will continue to be serviced by PSE.

The terms of the contract stipulate:

Microsoft will buy only carbon-free energy; purchase renewables at a level greatly in excess of the Renewable Portfolio Standards percentages established by the Washington Energy Independence Act (I-937), more than doubling that standard in 2021; and take significant actions to protect ratepayers, including payment of a substantial transition fee and ongoing funding for conservation and low-income programs. Microsoft will continue to utilize PSE’s distribution system.

GeekWire previously reported that Microsoft would pay a $23.6 million fee that PSE would return to its customers.

“This agreement is good for our business, but more important it’s good for residents, the environment and the state of Washington,” Brad Smith, president and chief legal officer of Microsoft, said in the release. “Once the transition is complete, the vast majority of our Puget Sound campus will be powered solely by carbon-free fuels. This contract is a helpful innovation in meeting the demand for renewable energy in a way that protects other energy consumers.”

Kimberly Harris, president and CEO of Puget Sound Energy, called the energy needs of the utility’s customers “unique.”

“Our history of working with our customers and the WUTC to advance innovative rate ideas includes responding to the 2001 energy crisis with a new structure for large customers to manage their own power, current offerings like the Microsoft contract, our Green Direct program for commercial and municipal customers, and our Solar Choice option for residential customers,” Harris said in a statement. “We’re proud to be a part of Microsoft’s response to renewable energy demands, and we’re proud to be part of the lives of our million-plus customers across Western Washington.”

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