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Biochar not only sequesters carbon but also improves soil quality. Pictured is a biochar test site operated by carbon removal company Exomad Green. (Image: Exomad Green’s official website)
Microsoft has once again broken records in carbon removal procurement, announcing on May 21 the signing of the world’s largest biochar carbon removal deal with Bolivian company Exomad Green. The deal aims to remove up to 1.24 million tons of CO2 over the next decade. This milestone brings the once-understated biochar technology into the spotlight as a mainstream tool for carbon reduction. Why is biochar suddenly in the limelight?
Competition for high-quality carbon removal technologies is escalating. According to a recent report by carbon removal marketplace Supercritical, 62% of the global supply of high-quality biochar for 2025 has been secured by long-term contracts, and nearly 30% of the capacity for 2026 has been pre-booked. In other words, companies that haven’t secured long-term agreements may find themselves unable to purchase supply in the future.
Microsoft drives biochar market toward scale
The long-term agreement signed between Microsoft and Exomad Green is regarded as a major milestone in scaling global biochar removal to an industrial level. As one of the world’s largest carbon removal suppliers, Exomad Green uses the third-party platform Carbonfuture to track the destination and storage of each ton of carbon. The project will also be certified under the standards of international registry Puro.earth, ensuring transparency and credibility.
Exomad Green uses pyrolysis technology to convert timber waste into biochar, a material that can lock away carbon for centuries. Beyond carbon storage, biochar also serves as a soil enhancer, helping boost crop yields and reduce pollution from open burning. The project is expected to deliver meaningful environmental and social benefits to around 250,000 residents.
According to Exomad Green, Microsoft’s bold investment demonstrates true climate leadership and signals that biochar has moved beyond the experimental phase. It is now a scalable and transparent solution for carbon removal. The company also plans to expand its production capacity, with the long-term goal of removing 1 million tons of CO2 annually.
Microsoft’s carbon removal procurement portfolio from 2021 to 2023 shows a growing focus on direct air capture and biochar CDR credits. (Source: RECCESSARY)
Biochar supply tightens as tech giants secure contracts early
In fact, Microsoft isn’t the only tech giants betting on biochar. Companies like Google and Stripe have signed procurement agreements ranging from tens of thousands to several hundred thousand tons. For instance, Google has sealed a long-term contract with Indian carbon removal startup Varaha to purchase a total of 200,000 tons.
These long-term procurement deals, known as offtake agreements, allow companies to secure future carbon credits at lower costs while providing suppliers with funding for capacity expansion and financial stability. According to Supercritical’s report, the cost difference between offtake and spot market buyers can be as high as 31%. Meanwhile, spot market prices have risen for four consecutive years at a compound annual growth rate of 29.2%, with an 18% increase in 2024 alone.
“This is no longer just about purchasing carbon removal credits; it’s now a race to secure supply,” said Supercritical CEO Michelle You.
Why is biochar in high demand? Three key advantages driving corporate investment
Among carbon removal technologies, biochar has become a favored option in corporate net-zero investment portfolios. From a technical, economic, and social standpoint, biochar offers three major advantages that are convincing companies to invest early and decisively.
1. Cost competitiveness
According to data from US financial service firm MSCI, the average price for biochar carbon credits in 2023 was around USD 150/ton. While the price is significantly higher than the average price of USD 5.8/ton in the voluntary market, it remains competitive compared to other carbon removal technologies, such as direct air capture (DAC), which can cost upwards of USD 400/ton.
2. Mature technology allows rapid expansion
Biochar is a mature technology that coverts agricultural or forestry waste into stable carbon materials through thermal processing under oxygen-limited conditions. These materials are then stored in soil, enabling carbon sequestration that can last for hundreds to thousands of years.
What’s more, biochar offers rapid scalability, as data from 2024 shows that 86% of the global carbon removal deliveries came from biochar, indicating its potential to become the major technology for large scale carbon removal.
3. High environmental co-benefits
Compared to other carbon removal technologies, biochar offers significantly greater environmental co-benefits. It not only improves soil structure and boost crop yields but also increase farmers’ income and reduces the burden of waste disposal. Exomad Green’s projects, for example, have helped mitigate air pollution and fire risks associated with burning wood residues. These advantages position biochar as a preferred solution in ESG evaluations and carbon credit verification standards.
Carbon removal solutions vary in technological readiness levels (TRL), with biochar and afforestation ranked among the most mature. (Source: RECCESSARY)
Companies race to secure carbon credits and strengthen market influence
MSCI points out that global demand for biochar carbon credits could grow twentyfold over the next decade. Supercritical also expects global demand for durable carbon removal to soar to between 40 million to 200 million tons annually by 2030. If just 10% of the companies with science-based targets (SBTi) start purchasing carbon removal solutions, the market would need to expand 25-fold to meet demand.
As the carbon removal market rapidly diversifies, early movers will secure supply and pricing leverage, whereas those lagging behind will be left with costlier and lower-quality options, said You.
For companies looking to gain a strategic edge before biochar supply tightens, Sherry Hu, carbon market analyst at RECCESSARY, suggests taking early action with three key strategies:
1. Sign long-term agreement: Enter into offtake agreements with carbon removal suppliers to secure pricing and supply, while mitigate market volatility risks.
2. Integrate into internal planning: Establish an internal roadmap and allocate budgets for carbon removal, treating it as a core component of medium- to long-term net-zero strategies rather than a last-minute remedy."
3. Choose certified partners: Prioritize projects that are certified by recognized international standards.
In addition to the four major carbon standard agencies, several international platforms now specialize in biochar methodologies and certification, which can serve as valuable references for companies seeking to strengthen their ESG ratings and enhance brand resilience, according to Hu. As the carbon removal market enters a critical “first come, first served” phase, those who move early will be better positioned to secure high-quality carbon credits at reasonable prices and gain a competitive edge in the race to net zero.
Source: Carbon Credits, Carbon Herald, Exomad Green, Carbon Herald
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