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Microsoft and Puget Sound Energy (PSE) have struck a deal that would allow the Redmond, Wash. software giant to shift 80 percent of its energy use on campus to renewable sources purchased wholesale from other providers.

Microsoft sought the settlement agreement because PSE wasn’t able to provide enough renewable energy to meet the company’s sustainability goals. Under the agreement, Microsoft would still pay PSE to deliver the wholesale electricity purchased from other sources, the Seattle Times reported.

If approved, Microsoft would also pay a $23.6 million fee “that PSE would return to its customers,” according to a press release from UTC. The deal will be reviewed by Washington’s Utilities and Transportation Commission (UTC) in the coming weeks.

“This proposed contract is going to be good for our business,” Irene Plenefisch, Microsoft’s government affairs director, told GeekWire. “It’s going to help us achieve our sustainability goals more effectively and efficiently … We’re increasing and maintaining our investment in programs for conservation and low-income ratepayers and we think it’s good for the environment because of the commitments we’re making around renewable and carbon-free resources.”

It’s important to note that the deal only covers power consumed by Microsoft’s offices at its Redmond campus. It doesn’t apply to the energy-hungry data centers that power the company’s cloud computing operations. But Microsoft has also pledged to move half of the power its data centers use to renewable sources by next year.

If the settlement deal is approved, Microsoft will continue giving money to PSE’s low-income energy program and contribute additional funds for energy efficiency and renewable energy programs for low-income residents, according to UTC.

The Kroger Company, Sam’s West and Walmart, The Energy Project, The Northwest & Intermountain Power Producers Coalition, The Industrial Customers of Northwest Utilities, and the NW Energy Coalition also signed the agreement.

“I can’t speak for other companies, but I think our agreement sets a really good model for anyone following in the sense that it sets high targets for renewable energies and a high standard for taking care of other ratepayers,” said Plenefisch.

If approved, the deal would provide a new avenue for businesses in Washington that want to shift to more renewable power sources or take more ownership of their energy consumption.

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