Key takeaways
- Technology giants are “mining” rare earth elements and precious metals from old computer hardware and recovered electronics to meet waste reduction goals.
- Apple and Google are also recovering precious metals and rare earth elements.
- The company recycled or reused almost 91 percent of its decommissioned servers and other data center hardware in 2024.
Microsoft is expanding electronic waste collection from its data centers with a new initiative to recover rare earth elements and precious metals from hard drives without using acids.
The program announced April 17 is a collaboration between drive maker Western Digital along with Critical Materials Recycling and PedalPoint Recycling. It aims to scale U.S. production of rare earth elements at a time when the world’s biggest supplier, China, has threatened to cut off exports amid an escalating global trade war.
So far, the pilot has processed 50,000 pounds of obsolete drives collected at Microsoft data centers, extracting rare earth elements including neodymium, praseodymium and dysprosium — crucial components for magnets used in electric vehicles and wind turbines. The initiative has also recovered gold, copper, aluminum and steel.
A Microsoft executive declined to disclose how much of these materials has been recovered, what percentage of end-of-life hard drives was included under the program or whether the company received a financial benefit by participating.
“This is the right thing to do,” said Rani Borkar, corporate vice president of Azure hardware and systems at Microsoft, pointing to the company’s 2030 zero waste goal.
Rising demand
Microsoft, like its primary rivals in cloud computing Google and Amazon, is expanding its data center footprint at a furious pace. Hard drives will account for about 80 percent of the data storage capacity at hyperscale and cloud services facilities through 2028, according to forecasts by researcher IDC. This technology depends heavily on rare earth elements and precious metals, as do many systems enabling the clean energy transition.
The materials already recovered from several Microsoft data centers are being fed back into the U.S. supply chain, which accounts for just 15 percent of rare earth production. Other large technology companies, including Apple and Google, are also mining rare earths and other precious metals from old electronics and computer hardware.
No one is doing this at scale. The current U.S. recycling rate for rare earths is less than 10 percent, according to Western Digital.
The project highlighted by Microsoft uses a multi-step process pioneered by Critical Materials Recycling:
- Obsolete or old drives are shredded using traditional processes.
- That material is sorted and processed by PedalPoint, and the magnets and steel are sent to Critical Materials for sorting.
- Rare earth oxides are extracted using a chemical recycling process that doesn’t contain acids.
“This project isn’t just a milestone, it’s a blueprint for large-scale, domestic recycling of essential metals and materials that will drive sustainable progress for years to come,” said Jackie Jung, vice president of global operations strategy and corporate sustainability at Western Digital.
Demand for rare earth metals is growing at 9 percent annually, and the market is projected to reach $16.3 billion by 2030.
Microsoft’s zero-waste agenda
The rare earths recovery effort is just one component of Microsoft’s strategy to keep computer hardware out of landfills. It recycled or reused close to 91 percent of the computer servers and other technologies that run its Azure cloud services in 2024, meeting its 2025 target and keeping 3.2 million components in circulation throughout its data centers.
Much of that work is being delivered by Circular Centers, regional sites that handle technology that’s become obsolete for Microsoft’s data center applications. The average lifespan of computer servers is between four and six years, depending on the application.
Through this program, high-value components such as memory or central processing units are removed and redeployed. Some systems are donated to local organizations such as schools or community groups.
So far, Microsoft manages six Circular Centers in the U.S., Ireland, the Netherlands and Singapore. It’s planning three more: in Australia, the U.S. and Wales.
[Gain insights to move beyond incremental action and accelerate the shift to a circular economy at Circularity, April 29-May 1, Denver, CO.]
