The process of charring barrels originated with Elijah Craig, an eighteenth-century minister and distiller from Georgetown, Kentucky. Craig "discovered" charring when several barrels he was preparing for transportation to market caught fire. He used them anyway and the rest is history.
Today, Bourbon barrels are charred to different degrees, ranked from one to four, depending on the depth of the bum. Single-barrel and small-batch Bourbons are usually aged in a three or four char barrel (moderate to heavy). The charring not only darkens the wood but also caramelizes some of the natural sugars in the oak.