Biomethane Market By Feedstock (Agricultural Waste, Energy Crops, Organic Municipal Waste, Sewage Sludge, Industrial Waste); By Application (Power Generation, Transportation, Heating); By End User (Utilities, Transport Companies, Industrial Users, Agricultural Cooperatives, Municipal Waste Authorities); By Geography, Segment Revenue Estimation, Forecast, 2024–2030

Introduction And Strategic Context

The Global Biomethane Market will witness a robust CAGR of 14.56 % , valued at USD 5.4 billion in 2024, expected to appreciate and reach USD 11.7 billion by 2030, confirms Strategic Market Research.

 

Biomethane, also called renewable natural gas (RNG), is one of the few energy carriers that directly plug into existing gas grids while slashing greenhouse gas emissions. Produced through anaerobic digestion of organic waste—ranging from agricultural residues to municipal sludge—biomethane is chemically identical to fossil natural gas but far cleaner. That’s what makes it such a strategic fuel as countries push toward carbon neutrality without dismantling legacy energy infrastructure.

 

Between 2024 and 2030, biomethane’s appeal is accelerating for three main reasons: climate pressure, energy security, and gas grid decarbonization. Governments across Europe and North America are actively incentivizing biomethane injection into national gas networks. Meanwhile, natural gas price volatility is forcing utilities and industrial users to look harder at homegrown bio-based alternatives.

 

The market is also riding on aggressive EU climate mandates. The European Commission’s push to cut methane emissions and increase renewable gas volumes is putting biomethane front and center . Germany, France, and the Netherlands have all expanded biomethane subsidies in the past 18 months. In the U.S., California’s Low Carbon Fuel Standard (LCFS) continues to reward RNG in transportation and industrial heating. And now, more countries in Asia Pacific are testing biomethane programs to reduce urban landfill loads and boost rural bioeconomies .

 

This market is not just about policy, though. It’s getting pulled by industry too. Utilities are striking long-term offtake agreements with RNG producers. Agribusiness giants are entering joint ventures to monetize waste streams. And cleantech investors are pouring money into modular anaerobic digestion plants with integrated upgrading systems.

 

Here’s who’s driving the biomethane ecosystem:

• Project Developers designing large and small-scale biogas-to-RNG facilities.

• Gas Grid Operators integrating biomethane pipelines and injection points.

• Transport Fleets using RNG to replace diesel in heavy-duty trucking and city buses.

• Utilities and Municipalities signing offtake agreements for heating and electricity.

• Technology Providers supplying upgrading systems (membrane separation, water scrubbing, pressure swing adsorption).

• Investors and ESG Funds seeing biomethane as a bankable, scalable carbon solution.

 

Market Segmentation And Forecast Scope

The biomethane market breaks down along several strategic dimensions, with applications and feedstock availability shaping demand patterns worldwide. For this RD, segmentation is framed across four key axes:

By Feedstock

Agricultural Waste , Energy Crops , Industrial Waste , Sewage Sludge , and Organic Municipal Waste dominate the upstream side of biomethane production. Among these, agricultural waste leads in volume—particularly in countries with intensive livestock farming. Manure and crop residues are plentiful and consistent, making them a reliable base for anaerobic digestion.

However, organic municipal waste is the fastest-growing feedstock source, thanks to stricter landfill diversion laws and city-level circular economy programs. More municipalities are turning food waste into feedstock for RNG plants to offset landfill methane.

Insight: A mid-sized European city diverting just 20% of its food waste could power thousands of homes with locally sourced biomethane.

 

By Application

Applications fall into three dominant buckets:

• Power Generation – Used in CHP plants or injected into the grid for electricity.

• Transportation Fuel – Compressed or liquefied biomethane powering trucks, buses, and fleets.

• Heating (Industrial and Residential) – RNG replaces fossil gas in boilers and furnaces.

In 2024, power generation makes up just over 40% of market value. But transportation is projected to be the fastest riser, especially in Europe and California, where policy incentives are structured around carbon intensity reductions in fuel.

Commentary: Biomethane’s rise as a transport fuel hinges on its ultra-low carbon score—especially when sourced from dairy or landfill waste. This gives it a compliance edge over even electric vehicles in some policy models.

 

By End User

End users include:

• Utilities & Grid Operators

• Transport Companies (public and private fleets)

• Industrial Energy Users

• Agricultural Cooperatives

• Municipal Waste Authorities

Utilities and transport companies are the top revenue contributors. Utilities lead on injection infrastructure, while transport companies—particularly logistics and urban transit fleets—are switching to biomethane to meet Scope 1 emissions targets.

Example: In Sweden, over 60% of public buses in major cities now run on RNG. That’s not just a green headline—it’s a quiet fuel switch that’s reshaping the downstream gas ecosystem.

 

By Region

As expected, the biomethane market spans:

• North America

• Europe

• Asia Pacific

• LAMEA (Latin America, Middle East, Africa)

Europe dominates in 2024, driven by aggressive national targets and generous feed-in tariffs. North America , led by California’s LCFS and RNG credits, holds the second-largest share. Asia Pacific is catching up fast, with China and India investing in agri -waste-to-energy infrastructure.

We’ll cover deeper regional nuances in Section 5.

 

Market Trends And Innovation Landscape

Biomethane may be a “mature” fuel in theory—but in practice, this market is evolving fast. From how it’s made to how it’s sold, new technologies and business models are unlocking fresh use cases and cutting costs across the board.

Decentralized Production Models Are Gaining Traction

Traditionally, biomethane came from large central anaerobic digestion (AD) plants, often linked to agriculture or landfill sites. That’s changing. We're seeing a rise in modular, containerized digesters —especially in Europe and North America—that can be deployed closer to waste sources.

Smaller dairy farms, food processors, and municipal facilities are now turning waste into pipeline-grade gas onsite.

One startup in France recently commissioned 10+ micro-digestion plants that feed RNG into rural gas grids—no trucking, no intermediaries. That decentralization lowers transport emissions and democratizes production.

 

Upgrading Tech is Getting Smarter and Cheaper

To convert raw biogas into usable biomethane, impurities like CO2 and hydrogen sulfide must be stripped out. Historically, this “upgrading” step was costly and energy-intensive. But newer methods— membrane separation , water scrubbing , cryogenic purification , and pressure swing adsorption (PSA) —are getting faster, cheaper, and easier to operate.

What’s more, AI-powered sensors now optimize flow rates and detect maintenance issues in real time. One German operator reported a 20% improvement in uptime after integrating predictive controls into its upgrading line.

 

Digital Platforms are Creating RNG Marketplaces

A subtle but powerful trend is the rise of digital trading platforms for RNG certificates . These platforms allow buyers—say, a shipping company—to purchase the environmental attributes of RNG, even if the gas itself never reaches their pipelines.

That’s opening the door for book-and-claim systems , where the gas flows into a public grid but the green benefit is traded digitally. In Europe and parts of the U.S., this is unlocking capital for RNG producers who want to monetize their carbon intensity credits or renewable fuel certificates.

 

Heavy-Duty Transport is a Game-Changer

Let’s be honest—passenger cars aren’t the sweet spot for biomethane. But long-haul trucking , waste fleets , and public buses are a different story. They need fast refueling , long range, and reliability—areas where compressed biomethane (CBG) and liquefied biomethane (LBG) shine.

Sweden and Italy have already demonstrated that RNG can displace diesel in fleet operations. Now, the U.S. and UK are ramping up grant programs for RNG refueling infrastructure tied to net-zero freight strategies.

 

Strategic Partnerships and Cross-Sector M&A

RNG isn’t just a niche project for utilities anymore. In the last two years, we’ve seen:

• Oil majors investing in biomethane startups (e.g., Shell acquiring Nature Energy in Denmark).

• Agriculture giants launching RNG platforms to monetize waste (e.g., Cargill co-developing digesters with co-ops).

• Equipment OEMs and gas distributors forming joint ventures to fast-track injection sites.

One major U.S. utility even spun off its RNG division as a standalone subsidiary to attract ESG capital—an early sign that biomethane is entering the big leagues.

 

Competitive Intelligence And Benchmarking

The biomethane market isn’t swarming with hundreds of players. Instead, it’s carved up by a focused group of energy incumbents, cleantech innovators, and infrastructure operators—each trying to lock in their role across the production, upgrading, and distribution chain. Here’s how the competitive landscape looks today.

Engie

This French energy giant is one of the most active biomethane developers in Europe. Engie operates dozens of AD and biomethane upgrading plants in France and Belgium and is investing in pipeline injection projects.

Its strategy is focused on:

• Vertical integration: from waste sourcing to grid injection

• Long-term utility offtake contracts

• Smart grid tech to balance supply from biomethane with demand-side fluctuations

Engie recently announced a 10-year roadmap to double its RNG output by 2030, tying it to its broader decarbonization plan.

 

Air Liquide

Air Liquide is known for its gas handling tech—but it’s quietly become a powerhouse in biomethane upgrading. It operates nearly 30 biomethane production units worldwide and specializes in membrane separation technologies.

Its key differentiator is:

• Strong IP in purification systems

• Global reach in both developed and emerging markets

• Focus on integrating RNG into industrial decarbonization workflows (e.g., steel, cement, glass)

Also, Air Liquide’s gas-as-a-service model helps small RNG producers avoid upfront CapEx , which is a clever move in fragmented feedstock regions.

 

Nature Energy (acquired by Shell)

Before being acquired by Shell in late 2022, Nature Energy was Europe’s largest producer of biomethane. Its model centered on large-scale centralized digesters , connected to agricultural zones with long-term feedstock contracts.

Shell’s acquisition gave Nature Energy:

• Global expansion capability

• Stronger transport fuel partnerships

• More muscle for lobbying around RNG policy

This deal was a turning point. It proved that major oil & gas players see RNG as a material piece of their net-zero puzzle.

 

Clean Energy Fuels

Based in California, Clean Energy Fuels leads the U.S. RNG transportation fuel market, particularly in CNG and LNG applications. Its Redeem™ branded fuel is sold at over 550 fueling stations nationwide.

What makes Clean Energy stand out:

• Deep relationships with fleet operators

• Co-development of fueling infrastructure with municipalities and private haulers

• Use of dairy and landfill gas to qualify for high LCFS credits

They’re essentially building the downstream biomethane equivalent of what Tesla did for EV charging.

 

Verbio

Headquartered in Germany, Verbio is a vertically integrated player producing bioethanol, biodiesel, and biomethane. Its facilities focus on straw-based digesters , making it one of the few large-scale operators using lignocellulosic biomass instead of food or manure.

Their strength lies in:

• Feedstock flexibility

• Integrated logistics (trucking, rail)

• Partnerships with German municipalities to tap underutilized rural waste

 

Others to Watch

• Gasum (Finland): Integrating biomethane into Nordic gas systems and heavy transport.

• TotalEnergies : Steadily building biomethane capacity via joint ventures and acquisitions.

• EnviTec Biogas : A turnkey tech provider for AD and upgrading plants, with strong presence in Germany and China.

• Bright Renewables : Specializes in biogas upgrading systems—particularly water scrubbing and PSA—for modular RNG deployment.

 

Competitive Dynamics

• Europe leads in plant count, policy, and scale. Giants like Engie and Air Liquide dominate.

• North America is tilted toward transportation use cases—Clean Energy Fuels holds ground here.

• Asia Pacific is still fragmented, but domestic players are emerging in India and China.

There’s growing M&A activity, with oil & gas firms snapping up RNG developers to de-risk their decarbonization portfolios. Price competition is moderate. What really moves the needle is project pipeline size , feedstock reliability , and grid access .

 

Regional Landscape And Adoption Outlook

Biomethane’s growth isn’t evenly spread across the globe. Regional adoption is shaped by feedstock availability, pipeline access, policy support, and—perhaps most critically—carbon pricing mechanisms. Let’s break down the market geographically.

Europe

Europe is easily the most mature and policy-driven biomethane market. Countries like France, Germany, the Netherlands, and Denmark have strong feed-in tariffs, national gas decarbonization mandates, and active landfill diversion strategies.

• France has over 500 injection points and continues to subsidize biomethane under its energy transition plan.

• Germany is leveraging its agricultural base, especially manure and crop residues, to supply decentralized biogas plants.

• Sweden and Italy are pioneers in using biomethane for public transportation.

The EU’s Fit for 55 package and REPowerEU strategy are accelerating biomethane capacity targets. Some estimates suggest the bloc wants 35 bcm of biomethane by 2030—a massive jump from current levels.

Commentary: Europe isn’t just leading in volume—it’s setting the regulatory blueprint others are starting to follow.

 

North America

The U.S. is seeing a bifurcated market—federal policy is modest, but California’s LCFS and Renewable Fuel Standard (RFS) have created a financial ecosystem around biomethane. Dairy farms, landfills, and wastewater plants are producing RNG for sale into the fuel market.

Key trends:

• California and Oregon dominate demand for transport-grade RNG.

• Midwestern states are ramping up dairy digesters linked to LCFS credits.

• Utilities like SoCalGas and Dominion Energy are injecting RNG into pipelines as part of net-zero pledges.

Canada is expanding too— British Columbia offers carbon credits for RNG, while Quebec and Ontario have grid-injection pilots underway.

 

Asia Pacific

This region is the fastest-growing, but highly variable:

• China has launched national biogas programs, particularly in rural zones. A few provinces now offer RNG injection incentives, but grid access is limited.

• India is scaling rapidly through its SATAT scheme , which targets over 5,000 compressed biogas plants using agricultural and food waste.

• Japan and South Korea are exploring biomethane for industrial and backup power use, but adoption is early-stage.

Challenges persist: fragmented policies, limited upgrading tech, and inconsistent waste management infrastructure. Still, the growth runway here is massive.

Insight: Asia isn’t yet competing on per-capita biomethane volumes, but it could outscale the West if policy bottlenecks are resolved.

 

LAMEA (Latin America, Middle East, Africa)

Adoption in Latin America is small but gaining momentum:

• Brazil has tapped sugarcane and agri -waste as feedstock for pilot biomethane plants, particularly near ethanol refineries.

• Colombia and Argentina are exploring RNG for transport fuels, but projects are mostly early-stage.

In the Middle East , Saudi Arabia and the UAE are funding waste-to-energy pilots that include biomethane, though landfill gas remains the main focus.

 

Africa , meanwhile, remains largely untapped—though NGOs and development banks are sponsoring small-scale biogas units in Kenya, Nigeria, and Rwanda. The leap from biogas to grid-injectable biomethane is still rare due to cost and pipeline limitations.

 

Regional Gaps and White Spaces

• Africa and Southeast Asia need enabling policies and public-private partnerships to unlock biomethane.

• Eastern Europe is under-penetrated despite having rich agricultural waste streams and legacy gas infrastructure.

• U.S. Midwest and South could grow faster if more states adopt LCFS-like incentives.

 

End-User Dynamics And Use Case

Biomethane adoption varies not just by region, but by who’s using it and why. While some players seek carbon offsets, others are driven by operational cost savings or regulatory mandates. Let’s unpack how different end users are shaping market demand.

Utilities and Gas Grid Operators

Utilities are the backbone of biomethane scaling. They’re responsible for connecting RNG production facilities to existing gas pipelines, handling certification, and managing flow integration with fossil gas.

• Many are under pressure to decarbonize their supply mix .

• Biomethane offers a drop-in solution—no pipeline overhauls, just cleaner molecules.

• Some utilities have gone further, signing long-term offtake contracts or investing directly in RNG facilities.

Example: In France, GRDF now supports over 500 biomethane injection sites, up from just 50 a few years ago.

 

Public Transport Fleets and Logistics Operators

City transit agencies and logistics firms are increasingly drawn to biomethane as a diesel substitute. RNG scores better than diesel on lifecycle emissions—and in regions with carbon pricing, that translates into real financial savings.

• Public bus fleets in Sweden, Italy, and California have transitioned partially or fully to RNG.

• Logistics companies like UPS and Amazon have trialed biomethane-powered delivery vehicles.

What makes this group important? Their demand is volume-driven and contract-based , giving biomethane producers predictable cash flow.

 

Industrial Heat Users

Industries that rely on high-temperature processes—like cement, ceramics, glass, and chemicals—face a tough decarbonization challenge. Biomethane is one of the few renewable options that can directly substitute fossil gas without major retrofitting.

• In Europe, industrial buyers are eligible for renewable gas certificates ( GoOs ).

• In the U.S., some buyers use RNG to meet internal ESG goals even if cost parity isn't there yet.

These customers aren’t chasing credits—they’re protecting their brand and preparing for future Scope 1 emissions rules.

 

Agricultural Cooperatives and Waste Producers

This group is both producer and consumer . Large dairy farms, food processors, and agri -coops often invest in digesters to turn manure or food waste into energy.

Why do they care?

• Biomethane reduces methane leaks from manure lagoons.

• It offsets fertilizer costs by generating digestate.

• And, in many countries, they can sell RNG to utilities and earn a second revenue stream.

Commentary: For farms, RNG isn’t just energy—it’s a waste solution and a new profit center .

 

Municipal Waste Authorities

City governments and waste agencies are increasingly turning to biomethane as part of their circular economy plans . Organic municipal waste is diverted from landfills and processed into biomethane, which can then power city buses, buildings, or be injected into the grid.

• Several cities in Germany and the Netherlands now treat food waste as fuel, not trash.

• In the U.S., pilot projects in New York, Los Angeles , and Seattle are looking to scale similar models.

 

Use Case Highlight: California Waste Fleet

In 2023, a large municipal waste collection company in California transitioned 200 diesel trucks to run on RNG sourced from food waste and dairy farms. Partnering with a local digester project, they slashed their fleet's lifecycle emissions by over 80%. Not only did they qualify for LCFS and RFS credits, but they also locked in lower, predictable fuel prices compared to diesel volatility.

Result? Fuel savings of $3 million annually and a 10-year supply contract that stabilized project economics for the RNG developer. That’s win-win infrastructure in action.

 

Recent Developments + Opportunities & Restraints

Recent Developments (2023–2024)

• Shell’s Acquisition of Nature Energy (2023):
  Shell acquired Denmark-based Nature Energy for over $2 billion, marking the largest biomethane acquisition to date. The deal gave Shell access to dozens of operating biogas plants across Europe, boosting its renewable gas portfolio.

• TotalEnergies and Veolia Joint Venture (2023):
  TotalEnergies partnered with Veolia to develop 15 new biomethane production units across France. The projects will use municipal and agricultural waste to generate over 700 GWh of RNG annually.

• California RNG Injection Milestone (2024):
  SoCalGas surpassed 5 billion cubic feet of RNG injected into its distribution system—up nearly 40% from 2022. The company has set a 2045 goal to deliver 20% renewable gas across its network.

• Bright Renewables Launches Plug-and-Play Upgrading System (2023):
  Bright Renewables introduced a compact upgrading unit tailored for small-scale biomethane producers in rural zones. The system uses membrane separation and modular controls to reduce CapEx by 30%.

 

Opportunities

• Transport Sector Decarbonization:
  With diesel bans looming in urban zones and fleet emissions under scrutiny, biomethane is positioned as a scalable, low-carbon alternative—especially for buses, refuse trucks, and long-haul transport.

• Agri-Waste Monetization in Asia and LATAM:
  Regions with abundant agricultural waste—like India, Brazil, and Indonesia—are underusing potential feedstock. Public-private partnerships could unlock untapped biomethane production at scale.

• Carbon Credit and RNG Certificate Markets:
  Biomethane qualifies for multiple carbon schemes (LCFS, RFS, GoOs ), enabling developers to stack revenue streams. As carbon intensity scoring matures, premium prices will follow low-emission sources.

 

Restraints

• High CapEx and Permit Complexity:
  Developing a biomethane facility can take 2–4 years, with multi-million-dollar investments in digesters, upgrading tech, and grid connections. Delays in permitting and local resistance can stall progress.

• Skilled Labor and Feedstock Reliability:
  Operating high-quality digesters and maintaining consistent feedstock quality isn’t trivial. In regions with fragmented waste collection or seasonality in agri -residues, output can be erratic.

 

7.1. Report Coverage Table

Report Attribute	Details
Forecast Period	2024 – 2030
Market Size Value in 2024	USD 5.4 Billion
Revenue Forecast in 2030	USD 11.7 Billion
Overall Growth Rate	CAGR of 14.56% (2024–2030)
Base Year for Estimation	2024
Historical Data	2019 – 2023
Unit	USD Million, CAGR (2024 – 2030)
Segmentation	By Feedstock, By Application, By End User, By Geography
By Feedstock	Agricultural Waste, Energy Crops, Organic Municipal Waste, Sewage Sludge, Industrial Waste
By Application	Power Generation, Transportation, Heating
By End User	Utilities, Transport Companies, Industrial Energy Users, Agricultural Cooperatives, Municipal Waste Authorities
By Region	North America, Europe, Asia-Pacific, Latin America, Middle East & Africa
Country Scope	U.S., UK, Germany, China, India, Japan, Brazil, etc.
Market Drivers	- Decarbonization mandates for utilities and transport - Circular economy goals in municipal waste - Rising carbon credit marketability
Customization Option	Available upon request