How to price one carbon credit from biochar: Calculation formula and influencing factors

Introduction: Why is determining the carbon credit value of biochar a matter of survival for the project?

In May 2025, Microsoft signed an agreement to buy 1.24 million tonnes of biochar carbon removal credits from Exomad Green, delivered over 10 years and certified under the Puro Standard; the price was not disclosed^[1]. Meanwhile, S&P Global Platts' October 2025 price assessment put biochar credits at roughly $125–170/tCO2e depending on the market, delivery period and certification standard^[2]. They are all biochar credits, yet prices can differ considerably. Why?

The answer lies in pricing mechanism - an area that remains unclear to most Vietnamese businesses, farm owners, and carbon project investors. The global Voluntary Carbon Market (VCM) is booming, and biochar has emerged as one of the most scientifically and commercially viable methods of Carbon Dioxide Removal (CDR). However, the Valuing one carbon credit from biochar It’s not as simple as adding production costs to profit.

Biochar provides double benefit: It generates revenue from carbon credits, improves agricultural land, and addresses the issue of agricultural byproducts (rice husks, sugarcane bagasse, and wood waste). However, if you don’t understand how the market sets prices, you’re likely to end up selling at a loss to international brokers.

This article will provide you with: specific pricing formula, 7 factors that directly influence the selling price, the 2025–2026 reference price framework, and a practical process for estimating the value of your biochar project on your own before sitting down at the negotiating table.

What are carbon credits from biochar? Formation mechanisms and units of measurement

Definition according to international standards

Carbon credits from biochar is a certificate confirming that 1 ton of CO2 equivalent (tCO2e) has been removed from the atmosphere and sustainably stored in biochar. Each credit equals 1 ton of CO2e, which is the standard trading unit on all international exchanges. This credit is issued after the project undergoes a verification process MRV (Monitoring - Reporting - Verification) strictly monitored by an independent third party (VVB - Validation and Verification Body).

The CDR mechanism and biochar’s “premium” status

Unlike credits from emission reductions, biochar belongs to CDR - removal of CO2 already in the atmosphere. Pyrolysing biomass turns organic carbon from plants into a stable form; most of the carbon in biochar persists in soil for hundreds of years^[3], and protocols such as Isometric and Puro.earth require storage of more than 200 years^{[4, 5]}.

Permanence and measurability have made biochar the most traded type of CDR credit: according to CDR.fyi, biochar accounts for 86% of durable CDR credits delivered and 92% of those retired since Q1 2022; Microsoft is the largest buyer, with 46% of contracted biochar credits^[6].

Distinguishing biochar from other types of credits

• Afforestation/REDD+: Carbon stored in trees risks being re-emitted (forest fires, logging).
• Renewable energy: Reduces emissions but does not remove CO2 from the atmosphere.
• Biochar: Removes CO2 and stores it long term; reference price around $125–170/tCO2e (Platts, Oct 2025)^[2].

The storage lifecycle and the significance of valuation

Biochar permanence is usually assessed through the H/C_org (hydrogen/organic carbon) molar ratio: the lower the ratio, the more stable the carbon. The EBC standard requires H/C_org below 0.7^[7]; according to a review by Lehmann et al., biochar with H/C_org below 0.5 retains on average about 82% of its carbon after 100 years^[8]. Each credit methodology has its own conversion, so read the exact methodology version the project applies.

• H/C_org below 0.7: the EBC minimum threshold^[7]
• H/C_org below 0.5: most of the carbon (about 82%) remains after 100 years^[8]

The longer the storage period, premium price the higher, as the sustainability of the credits increases.

Common issuance standards

Each standard has a different audit cost structure and technical requirements, resulting in significantly different prices.

A Formula for Valuing Carbon Credits from Biochar: From Theory to Practice

Basic formula

The price of one carbon credit for biochar is determined by four factors:

> Selling Price = Production Cost + Verification Cost + Profit Margin + Quality Premium

Understanding each component helps you negotiate a fair price and avoid being pressured into accepting a lower offer.

Step 1: Calculate the amount of CO2e sequestered

Standard formula:

> CO2e sequestered = Biochar mass × % Carbon sequestered × Permanence factor × 3.67

Where: % organic carbon must be measured for each biochar batch (rice husk biochar usually has a lot of silica ash, so its carbon content is lower than wood biochar^[11]); the storage factor depends on carbon stability (H/C_org) and the rules of each methodology; 3.67 is the C-to-CO2 conversion factor (44/12).

Illustrative example (assumed figures): 1 tonne of biochar with 50% organic carbon and a storage factor of 0.8 corresponds to: 1 × 0.5 × 0.8 × 3.67 ≈ 1.47 tonnes CO2e (before subtracting life-cycle emissions).

Step 2: Deduct emissions generated during production (LCA)

Life Cycle Assessment (LCA) Require the calculation of all emissions generated throughout the value chain:

• Transportation of raw materials
• Energy required to operate a pyrolysis furnace
• Gas emissions (CH4, N2O) during pyrolysis
• Deliver the product to the point of use

These emissions vary greatly between projects and must be calculated from each project's actual data. Net credits = gross CO2e − life-cycle emissions; protocols such as Isometric only accept projects that achieve a net-negative CO2e impact^[4].

Step 3: Apply the permanence factor

Some methodologies adjust the storage factor according to biochar properties and the conditions where it is used (e.g. soil temperature). Projects should read the specific methodology they apply carefully rather than use a fixed factor.

Step 4: Cost-plus vs. Market-based Pricing

Cost-plus pricing:

> Selling price = (Production cost + Verification cost) / (1 - Desired margin)

Suitable for small projects that do not have a strong brand presence in the market.

Market-based pricing:

Based on current market prices (market comparables), adjusted for project quality. Suitable for projects that already have reputable certification and can sell directly to large buyers; Microsoft, Google, BCG and JPMorgan accounted for 57% of biochar credit purchases as of mid-2025^[6].

Illustrative calculation: A 1,000 tonne/year rice husk biochar project in the Mekong Delta

Input data (assumed for illustration): biochar output 1,000 tonnes/year; organic carbon 50%; storage factor 0.8; life-cycle emissions 15% (kiln operation, logistics).

Calculation: Gross CO2e: 1,000 × 0.5 × 0.8 × 3.67 ≈ 1,468 tCO2e; net CO2e (after life-cycle emissions): 1,468 × (1 − 0.15) ≈ 1,248 credits.

Cost items to break down per credit:

• Rice husk feedstock and collection
• Pyrolysis kiln operation
• Laboratory analysis, verification (VVB) and registration fees
• Exchange and brokerage fees

At a reference price of $135–158/credit (Platts, Oct 2025)^[2], assumed credit revenue would be roughly $168,000–197,000/year, before costs and excluding biochar sales revenue. This is only an illustrative calculation; a real project needs measured data and specific quotes.

7 key factors that directly influence the price of one carbon credit for biochar

1. Feedstock

The type of raw material is the deciding factor both cost and quality credits:

• Waste wood/sawdust: Usually carbon-rich, low in ash, easy to standardize
• Rice husk: Readily available in Vietnam, but high in silica ash, so lower in carbon^[11]
• Bagasse: High moisture, large pre-treatment cost
• Mixed agricultural waste: Difficult to standardize, lower prices

2. Pyrolysis technology

Temperature and residence time directly affect H/C_org:

• Slow pyrolysis: Long residence time, high char yield (about 35% by mass)^[12], suited to biochar goals
• Fast pyrolysis: Very rapid heating, favours bio-oil, only about 15–25% solids^[12]
• Gasification: Primarily used for gas production, biochar byproducts vary in quality

The more parameters a technology can measure, the easier it is to substantiate MRV data.

3. End-use

When biochar is used in applications long-term sustainability, tuition fees have risen significantly:

• Mixing into concrete and building materials: VM0044 covers this non-soil application^[9]
• Agricultural land reclamation: Standards, reference prices
• Water filtration: Need to verify there are no carbon leaks; average price

4. VVB Certification Standards and Reputation

The reputation of the standard and the verifier (VVB) affects buyer confidence. According to Platts (Oct 2025), CSI credits were offered at about $150, Puro.earth at about $158 and Isometric at about $170/tCO2e^[2].

5. Co-benefits

Projects that generate non-carbon benefits will be valued more highly:

• Contribution SDGs (No Poverty, Zero Hunger, Climate Action)
• Create local jobs
• Protecting biodiversity
• Increasing agricultural productivity

Co-benefits can help a project win over buyers, but any price premium depends on each agreement.

6. Geographic Location and Logistics

Projects near export ports with good logistics infrastructure have lower biochar delivery costs and audit costs (experts can reach them easily). Projects in remote areas usually face higher costs.

7. Timing and Method of Sale

• Spot (immediate delivery): Highest price, but inventory risk
• Forward contracts: Stable prices, priority given to large buyers
• Pre-sale (selling before issuance): Usually means accepting a lower price to raise capital early

New projects often opt for pre-sales to generate cash flow, but this is precisely why many Vietnamese projects end up selling at a loss.

Market fluctuations and the biochar credit reference price range for 2025–2026

Current global price levels

According to S&P Global Platts' October 2025 assessment^[2]:

• US (2025 delivery): about $150/tCO2e
• India: about $135/tCO2e (current year), $125/tCO2e (next year)
• By standard: CSI about $150, Puro.earth about $158, Isometric about $170/tCO2e

Comparison of trading platforms

• Puro.earth: An exchange and registry specializing in CDR, issuing CORC credits^[5]
• CIX (Climate Impact X): Singapore Exchange, competitive pricing
• Patch: B2B platform serving retail businesses
• Supercritical: Specializing in high-end CDR; the client is a technology corporation

Demand from technology companies

Microsoft is the largest buyer of biochar credits (46% of contracted volume); together with Google, BCG and JPMorgan it accounts for 57% of purchases^[6].

According to CDR.fyi, about 3.04 million tonnes of biochar credits were contracted from 2022 to the end of H1 2025 (1.6 million tonnes in H1 2025 alone); market value in 2024 was about USD 181.5 million^[6].

Legal implications

• Decree 06/2022/ND-CP: regulates greenhouse gas mitigation and provides the legal basis for the domestic carbon market^[13]
• Decision 232/QD-TTg (24 January 2025): approves the Scheme to establish and develop the carbon market, with a pilot phase in 2025–2028 and official operation from 2029^[14]

Outlook

Demand for biochar credits is currently concentrated among a few large buyers^[6], so prices may fluctuate as supply and demand change. Projects should build conservative price scenarios rather than rely on a single forecast.

Practical Guide: How to Estimate the Value of Your Biochar Project

Create an Excel pricing template

An effective Excel valuation file should include four main sheets:

1. Input Data: Raw materials, production volume, technology, location

2. CO2e Calculation: Calculate gross and net CO2e using the formula provided

3. Cost Structure: Breakdown of costs by stage (raw materials, operations, verification, platform fees)

4. Revenue & Scenarios: 3 price scenarios (pessimistic/base/optimistic)

10-Question Checklist Before Valuation

• Is there a stable supply of raw materials for the next 10 to 20 years?
• Has H/C_org been measured and does it meet the standard's threshold (EBC: below 0.7)?
• Which standard should I choose (Puro, Verra, EBC)?
• Has VVB agreed to verify this yet?
• Have the LCA costs been fully accounted for?
• What are the co-benefits of increasing the premium?
• Have you researched the prices of 3–5 similar projects yet?
• Spot, forward, or pre-sale?
• Are there any potential buyers, or has it been listed on a platform?
• What is the minimum price negotiation strategy?

Free data sources for reference

• Puro.earth: Disclosure of Transactions and Public Prices
• CDR.fyi: Keep track of all global CDR deals
• Allied Offsets: Carbon Market Report
• Biochar-Market.com: Biochar and credit price updates
• Carbon Credits.com: News and price analysis

When should you hire a professional consultant?

Hire a consultant when:

• Projects >5,000 credits/year
• Want to register for Verra or EBC (a complex process)
• No MRV experience

Consulting costs depend on the scope of work; request quotes from several firms and compare them with expected credit revenue.

3 Common Valuation Pitfalls

1. Pre-selling too early at a deep discount: Before a project is verified, buyers usually offer low prices, which can lock in long-term revenue
2. Not valuing co-benefits: Overlooking social/environmental value makes buyers harder to convince
3. Selecting the wrong standard: It’s easy to meet the basic standards at a low cost, rather than investing more to meet the premium standards

Small projects vs large projects

Small projects can reach buyers who prioritize quality and an impact story, while large projects have advantages in cost per credit and the ability to sign long-term contracts – for example the 1.24 million tonne agreement between Exomad Green and Microsoft^[1]. BiocharVN is not aware of any published real-world biochar credit project in Vietnam to use as a case study; businesses should build their own financial model from their own measured data.

Conclusions and Action Plan

3 Golden Rules for Valuing Biochar Carbon Credits

1. Quality determines price: Invest in technology, data and certification that suit your target buyers

2. MRV Data Transparency: Major buyers are willing to pay a premium for projects with accurate and transparent metrics

3. Don't rush into pre-sales: Unless you really need cash flow, consider waiting for verification to get a better negotiating position

A 5-step roadmap to optimize the selling price (for reference)

1. January–February: Conduct a feasibility study, select standards, and estimate CO2e

2. March–June: Designing the MRV system, selecting VVBs, and preparing documentation

3. July–October: Production Operations and Data Collection

4. November 14: Verification, issuance of credits

5. 15+ months: Sell through a trading platform or directly to a corporate buyer

Future trends

Digital MRV (sensors, batch-tracking software, third-party MRV platforms such as Carbonfuture in the Exomad – Microsoft agreement^[1]) can help reduce verification costs and open the market to small projects.

FAQ

What is the current price of biochar credits? According to Platts in October 2025, about $125–170/tCO2e depending on the market, delivery period and standard^[2].

Can small projects sell credits? Possibly, but check each standard's requirements and compare certification costs with expected credit volumes.

How long from production to selling credits? There is no fixed timeline; it depends on MRV design, data collection, verification and registration under the standard.

Does Vietnam have an exchange yet? Under Decision 232/QD-TTg, the domestic carbon market is being piloted in 2025–2028 and will operate officially from 2029^[14]. Voluntary credit projects currently trade mainly through international registries.

Call to Action

Pricing biochar carbon credits must be based on actual measured data, the standard's methodology and up-to-date market prices. If you have a biochar project or are considering investing, don't start negotiating without a detailed calculation model: build a spreadsheet following the guidance above, consult data from CDR.fyi and Puro.earth, and seek professional advice before signing a contract.

References

1. CDR.fyi (2025). Mega CDR Deal Alert: Exomad Green – Microsoft, 21/5/2025. View source
2. Biochar Today (2025). Biochar Market Shows Price Stability Despite Drop in Retirements, 14 November 2025 (reporting S&P Global Platts price assessments for October 2025). View source
3. Wang, J., Xiong, Z., Kuzyakov, Y. (2016). Biochar stability in soil: meta-analysis of decomposition and priming effects. GCB Bioenergy, 8(3), 512–523. doi:10.1111/gcbb.12266
4. Isometric. Biochar Production and Storage (protocol), version 1.4. View source
5. Puro.earth. Biochar – Puro Standard Biochar Methodology (Edition 2025). View source
6. CDR.fyi (2025). Biochar Carbon Removal Market Snapshot 2025, 9/9/2025. View source
7. Carbon Standards International (2025). European Biochar Certificate (EBC) – Guidelines for a Sustainable Production of Biochar, version 10.5E, 14 August 2025. Frick, Switzerland. View source
8. Lehmann, J., Cowie, A., Masiello, C.A. et al. (2021). Biochar in climate change mitigation. Nature Geoscience, 14, 883–892. doi:10.1038/s41561-021-00852-8
9. Verra. VM0044 Biochar Utilization in Soil and Non-Soil Applications, version 1.2 (effective 27 June 2025). View source
10. European Biochar Certificate. Certificates, guidelines and documents (EBC, WBC, Global Biochar C-Sink, Global Artisan C-Sink). View source
11. Asadi, H., Ghorbani, M., Rezaei-Rashti, M. et al. (2021). Application of Rice Husk Biochar for Achieving Sustainable Agriculture and Environment. Rice Science, 28(4), 325–343. View source
12. Jahirul, M.I., Rasul, M.G., Chowdhury, A.A., Ashwath, N. (2012). Biofuels Production through Biomass Pyrolysis – A Technological Review. Energies, 5(12), 4952–5001. doi:10.3390/en5124952
13. Government of Vietnam (2022). Decree 06/2022/NĐ-CP of 7 January 2022 on greenhouse gas mitigation and ozone layer protection (in Vietnamese). View source
14. VnEconomy (2025). Việt Nam sẽ thí điểm sàn giao dịch carbon từ 2025, vận hành chính thức vào 2029 [Vietnam to pilot a carbon exchange from 2025, with full operation in 2029], on Decision 232/QĐ-TTg of 24 January 2025 (in Vietnamese). View source