Climate Impact Partners has announced a partnership with Terra Natural Capital to provide long-term finance for the Panna afforestation project in India. As part of the agreement, Microsoft will purchase 1.5 million tonnes of verified carbon removal credits over 30 years, representing half of the project’s total output.
The initiative brings together Climate Impact Partners’ project development expertise, funding from Terra Natural Capital, and Microsoft’s long-term commitment as a buyer. Panna is Microsoft’s largest carbon removal project in the Asia-Pacific (APAC) region and its first in India.
Following three years of due diligence and pilot activities, the project has met rigorous quality standards through assessments conducted by Climate Impact Partners, independent buyers, and investors. In collaboration with local implementation partners, the initiative will plant up to 11.6 million mixed native trees across 20,000 hectares of farmer and community lands—an area larger than Washington DC. To date, more than 1.2 million trees have been planted across 100 communities.
The Panna afforestation project is designed to deliver significant environmental and socio-economic benefits. It aims to promote economic empowerment by ensuring that farmers receive a share of carbon credit sales and generate income from fruit and medicinal produce cultivated on newly planted trees. Additionally, the initiative supports sustainable agriculture by offering training in climate-smart farming techniques to help improve long-term yields. Water conservation is a key focus, with the development of essential infrastructure such as ponds, borewells, and drip irrigation systems to sustain tree growth while efficiently capturing and conserving water. The project also prioritises biodiversity restoration, with the planting of native species expected to rejuvenate degraded lands and attract butterfly and bird populations back to the region.
Sheri Hickok, CEO of Climate Impact Partners, highlighted the significance of the initiative, “We are incredibly proud that Microsoft is supporting Panna, a project developed by our expert team. By securing a long-term supply of high-quality carbon credits, this model empowers companies like Microsoft to meet their ambitious climate targets, drive growth in the carbon removal market, and bring benefits to communities most impacted by climate change.”
Brian Marrs, Senior Director of Energy Markets at Microsoft, emphasised the importance of nature-based solutions, “At Microsoft, we believe that high-quality, nature-based solutions are vital to addressing climate change. Panna forms an important part of our growing portfolio of carbon removal projects—our first in India and largest in the APAC region. The collaboration with Climate Impact Partners ensures that millions more trees are planted, more carbon is removed from the atmosphere, more jobs are created, and more finance flows back to local communities.”
Erica Vertefeuille, Managing Director at Terra Natural Capital, underscored the role of project financing, “This transaction reflects the power of collaboration between trusted project developers, corporate demand, and innovative finance to unlock climate impact. We recognise that access to project finance is a critical need for the carbon removal market to scale and are committed to providing long-term capital that will accelerate project development and empower corporates to achieve their climate targets.”
The project employs Verra’s latest Afforestation, Reforestation, and Revegetation Methodology (VM0047), approved under the Integrity Council for the Voluntary Carbon Market’s (ICVCM) Core Carbon Principles (CCP) label. It has received an A rating under BeZero’s ex-ante assessment and will be verified against the Climate, Community, and Biodiversity Standard to monitor its environmental and social co-benefits.
