The deal means that the tech giant will purchase all the wind energy produced at GE's new, 37 megawatt (MW) Tullahennel wind farm in County Kerry.
Each turbine at the site will have a battery integrated into it to help generate "valuable data" relating to energy storage, GE said. This will allow technicians to test how the batteries can be utilized to "capture and store" excess energy and send it back to the grid as and when required.
"This partnership with Microsoft expands GE's considerable presence and investment in Ireland, where we already employ over 1,500 people and, in particular, in the renewable energy sector," Andres Isaza, GE Renewable Energy's chief commercial officer, said in a statement.
Wind is now "one of the most competitive sources of electricity on the market today," Isaza added.
The announcement comes a week after Belgian offshore wind farm developer Parkwind said it would become a strategic partner in the Oriel Wind Farm in the northwest Irish Sea. The proposed 55-turbine project is set to be located 22 kilometers off the coast of Dundalk.
With a capacity of 330 MW, it will be able to supply green energy to 250,000 Irish homes, according to Oriel Windfarm Limited.