Varaha Signs Carbon Removal Agreement with Microsoft

Agreement Calls for Over 100,000 tonnes of Carbon Dioxide Removal (CDR) across 3 Years

GURUGRAM, India, Jan. 15, 2026 /PRNewswire/ -- Varaha, a leading developer of carbon dioxide removal (CDR) projects with smallholder farmers across Asia, today announced a major offtake agreement with Microsoft for biochar carbon removal in India.

Varaha will develop 18 industrial gasification reactors that will operate for 15 years, with a total projected removal volume exceeding 2 million tonnes of CO₂ over the project's lifetime.

The project sources cotton stalks from smallholder farms in Maharashtra, India for use as the feedstock for biochar production. After harvest, these stalks are treated as waste biomass, and open-field burning is a common practice across the region's cotton belt. This project provides an alternative use for the stalks, converting them into biochar through Varaha's biomass gasification facilities and sequestering biogenic carbon for centuries.

Delivering Local Impact

Varaha's biochar project also delivers measurable benefits for farmers and communities:

• Improvement in Air Quality: The project mitigates the widespread burning of cotton crop residue, significantly reducing PM 2.5 pollutants that contribute to poor air quality. By providing an economically viable alternative to field burning, the initiative tackles a major source of seasonal air pollution.
• Promotion of Regenerative Agriculture: Farmers participating in the program adopt regenerative practices like crop residue mulching and biochar application to soils, improving soil health, water retention, and long-term agricultural productivity.
• Lifting Farmer Livelihoods: The program directly enhances the livelihoods of thousands of smallholder farmers, who receive payment both for contributing agricultural biomass and for implementing crop residue incorporation practices.

"This agreement demonstrates that high-integrity carbon removal can drive transformative co-benefits for communities and ecosystems," said Madhur Jain, Varaha CEO. "We're not just removing carbon—we're creating economic incentives for farmers to mitigate open burning of crop residues."

The project's first reactor will operate alongside Varaha's 52-acre cotton research farm in Maharashtra, where Varaha works directly with farmers to test sustainable practices, including soil application of biochar, under real-world conditions. With up to 18 total reactors funded across India's cotton belt through Microsoft's commitment, the focus remains clear: scaling quickly while putting farmers first.

Setting New Standards for Asian Carbon Markets

The agreement signals growing recognition of the region's potential for high-quality carbon removal projects. Biochar offers permanent carbon storage on geological timescales while supporting agricultural systems, making it one of the most promising pathways for durable carbon dioxide removal.

"This offtake agreement broadens the diversity of Microsoft's carbon removal portfolio with Varaha's biochar project design that is both scalable and durable. It represents a step forward in scaling biochar CDR growth in Asia and advancing co-benefits for farmers—improved soils, cleaner air, and shared economic opportunity," said Phil Goodman, program director, CDR at Microsoft.

The credits generated through the Varaha program meet rigorous standards for measurement, reporting, and verification, ensuring that each tonne represents genuine, permanent carbon removal.

About Varaha

Varaha is a leading developer of carbon dioxide removal (CDR) projects in Asia, with a mission of scaling smallholder farmer-led climate solutions to remove carbon from the atmosphere and strengthen rural livelihoods. Specializing in regenerative agriculture, agroforestry, biochar, and enhanced rock weathering projects across South Asia, Varaha has pioneered a technology- and science-driven approach to carbon project development since its founding in 2022. Varaha is headquartered in Gurugram, India, and operates 20 carbon projects across India, Nepal, and Bangladesh.

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SOURCE Varaha ClimateAg