This study assessed the efficacy of granular cylindrical periodic discontinuous batch reactors (GC-PDBRs) for produced water (PW) treatment by employing eggshell and waste activated sludge (WAS) derived Nickel (Ni) augmented biochar. The synthesized biochar was magnetized to further enhance its contribution towards achieving carbon neutrality due to carbon negative nature, Carbon dioxide (CO2) sorption, and negative priming effects. The GC-PDBR1 and GC-PDBR2 process variables were optimized by the application of central composite design (CCD). This is to maximize the decarbonization rate. Results showed that the systems could reduce total phosphorus (TP) and chemical oxygen demand (COD) by 76–80% and 92–99%, respectively. Optimal organic matter and nutrient removals were achieved at 80% volumetric exchange ratio (VER), 5 min settling time and 3000 mg/L mixed liquor suspended solids (MLSS) concentration with desirability values of 0.811 and 0.954 for GC-PDBR1 and GC-PDBR2, respectively. Employing four distinct models, the biokinetic coefficients of the GC-PDBRs treating PW were calculated. The findings indicated that First order (0.0758–0.5365) and Monod models (0.8652–0.9925) have relatively low R2 values. However, the Grau Second-order model and Modified Stover-Kincannon model have high R2 values. This shows that, the Grau Second Order and Modified Stover-Kincannon models under various VER, settling time, and MLSS circumstances, are more suited to explain the removal of pollutants in the GC-PDBRs. Microbiological evaluation demonstrated that a high VER caused notable rises in the quantity of several microorganisms. Under high biological selective pressure, GC-PDBR2 demonstrated a greater percentage of nitrogen removal via autotrophic denitrification and a greater number of nitrifying bacteria. The overgrowth of bacteria such as Actinobacteriota spp. Bacteroidota spp, Gammaproteobacteria, Desulfuromonas Mesotoga in the phylum, class, and genus, has positively impacted on granule formation and stability. Taken together, our study through the introduction of intermittent aeration GC-PDBR systems with added magnetized waste derived biochar, is an innovative approach for simultaneous aerobic sludge granulation and PW treatment, thereby providing valuable contributions in the journey toward achieving decarbonization, carbon neutrality and sustainable development goals (SDGs).