In a patch of woodland on the outskirts of Hastings, on the English south coast, a group of men huddle around a brick laboratory as smoke curls from its two chimneys. The men are trying, with some chemical trickery, to bring a lucrative piece of South America to Sussex, to spark what they believe could be a £1bn industry in Britain.

The business is controversial. Some maintain it should be outlawed, and others say that only full-scale legalisation would control the risks. Until the fuss dies down, the men have decided to bury the powder they make in a nearby field.

Craig Sams, a millionaire chocolate maker, and Dan Morrell, a former music promoter and entrepreneur, are producing charcoal, and their aim is to get rich by selling it to tackle global warming.

Together Sams and Morrell make Carbon Gold, a company they have set up to exploit the growing interest in green solutions to climate change. The brick laboratory is, they claim, Britain’s first dedicated facility to produce biochar, which is what you call charcoal when you are selling it as a solution to global warming.

Their idea is a low-tech take on the futuristic concept of carbon capture and storage. Carbon, in the form of wood from trees and agricultural waste, can be turned to charcoal and buried in the ground, so storing it away from the atmosphere. If enough carbon can be buried in this way, then it could bolster so-far feeble global attempts to address climate change through cuts greenhouse gas emissions.

Making and burying biochar to help reduce carbon levels in the atmosphere has some heavy green backing, including scientist and author James Lovelock and Jim Hansen of Nasa. The journal Nature Reports Climate Change said that biochar “could be the closest contender yet for a silver-bullet solution to climate change“.

But it also has some high profile critics. Writing in this newspaper in March, George Monbiot said: “The idea that biochar is a universal solution that can be safely deployed on a vast scale is as misguided as Mao Zedong’s Great Leap Backwards.” He added: “According to the magical thinkers who promote it, the new miracle stops climate breakdown, replaces gas and petroleum, improves the fertility of the soil, reduces deforestation, cuts labour, creates employment, prevents respiratory disease and ensures that when you drop your toast it always lands butter side up.”

Good idea or bad, if Sams and Morrell have their way, green consumers who want to offset the damaging emissions from their flights or cars will soon be able to pay Carbon Gold to make biochar on their behalf. Within weeks, the company expects to be approved by the offset industry’s unofficial watchdog. Bigger markets could follow: the firm is among those lobbying for biochar credits to be included in the UN’s clean development mechanism – a global carbon trading scheme used by countries such as Britain to meet ambitious carbon targets. A decision could be made as soon as December, at key climate talks in Copenhagen.

Morrell, who founded Future Forests, which later became the Carbon Neutral Company, said: “Biochar is the only technology that enables us to take invisible carbon dioxide out of the atmosphere, transform it into black lumps of pure carbon and, by ploughing it into the soil, prevent it from going back into the atmosphere.”

He added: “We don’t want to clear-cut woodland and turn it to dust. That’s slightly alarmist. We’re not saying this is the answer to global warming, but I don’t see why it can’t be one of a suite of solutions.”

The duo’s biochar facility runs on wood from surrounding trees, part of a woodland owned by Sams. By lighting a fire in a chamber beneath and fiddling with the way air flows through the device, the team says it can convert about a third of the carbon locked in the wood to charcoal in 24 hours. The wood part burns and is part baked, in a process called pyrolysis.

Biochar is not emissions free – the rest of the carbon from the wood goes up in smoke, but Morrell says it is better for the climate than burning or leaving it to rot, which can produce methane. He says their primary targets are large agricultural sites such as vineyards and olive producers, which have large amounts of waste cuttings.

Under Carbon Gold’s business model, the firm would supply the technology to farmers and others, and take a cut of the valuable carbon credits generated by each tonne of carbon they store. It is already working on a similar project in Belize.

“It’s almost like a franchise,” says Sams, a founder of Green and Black’s chocolate and former chair of the Soil Association. “It’s the same principle as McDonalds,” he adds, then wishes he hadn’t.

Morrell’s answer to the critics of biochar is a rule book produced by the company that is currently being considered by the Voluntary Carbon Standard, which regulates carbon offsets. Morrell says it includes safeguards to make sure wood and other feedstocks used are sustainable, as well as to preserve biodiversity and to give work to local people. “Of course it will be easier to just clear cut forest, but we think we can set the bar high enough to keep those people out.”

There could be other benefits too, he says. Biochar could help make more soil productive, because it offers a surface for bugs to thrive. Charcoal mixed into the ground by Indian tribes centuries ago is often credited for the acclaimed rich and dark terra preta soils of the Amazon basin. If benefits can be proven, and Carbon Gold says local soil scientists are investigating, then biochar could perhaps claim extra carbon credits based on reduced fertiliser use. Sams is already experimenting with charcoal sprayed and ploughed onto a field next to the Sussex woodland.

Mike Childs, climate campaigner with Friends of the Earth, said: “The problems with biochar are largely the same as biofuel. If you manage it properly then making limited amounts is OK, sensible and useful. But there is massive pressure on forests for land and protecting ecosystems, and the potential to produce lots [of biochar] comes up against those pressures. In the short term it is not the answer to climate change.”