Biogas and Biomethane Market Size, Share, Growth, and Industry Analysis, By Types (Agriculture Type, Sewage and Wastewater Type, Landfill Type, Others), By Applications Covered (Electricity Generation, Vehicle Fuel, Gas Grid), Regional Insights and Forecast to 2033

Biogas and Biomethane Market Size

The global biogas and biomethane market was valued at USD 86,251.74 million in 2024 and is expected to reach USD 87,778.4 million in 2025, with a projected expansion to USD 101,005.7 million by 2033, exhibiting a CAGR of 1.77% during 2025-2033.

The U.S. biogas and biomethane market is growing steadily, driven by increasing adoption of renewable energy, government incentives for sustainable fuel production, and rising investments in waste-to-energy projects to support carbon reduction and energy security goals.

Key Findings 

• Market Size: Valued at 87778.4M in 2025, expected to reach 101005.7M by 2033, growing at a CAGR of 1.77%.
• Growth Drivers: 50% organic waste recycling, 40% increase in biomethane vehicle fuel use, 60% electricity from biogas, 30% public transport RNG adoption.
• Trends: 700+ biomethane plants in Europe, 25% of firms using blockchain for carbon credits, 30% CO₂ recovery in CCU-integrated biogas plants.
• Key Players: VERBIO, Nature Energy, Gasrec, Asia Biogas, Future Biogas
• Regional Insights: Europe produces 50% of global biogas, North America hosts 2,200+ plants, China owns 6,000+ units, 30% growth in MEA waste-to-energy adoption.
• Challenges: 25% higher capital cost, 20% lack of grid infrastructure, 15% feedstock fluctuation, 35% competitive pressure from solar and wind energy.
• Industry Impact: $2B EU investment, $1.5B U.S. RNG funding, $500M+ corporate biogas projects, 20% CO₂ emission offset via biomethane integration.
• Recent Developments: 20% capacity increase by VERBIO, 30% efficiency boost in AI-fed systems, 25% grid integration rise, 15% cost reduction in modular digesters.

The biogas and biomethane market is rapidly expanding due to the global shift toward renewable energy sources, carbon neutrality, and sustainable waste management. Biogas is produced from organic waste materials, including agricultural residues, food waste, and sewage sludge, making it a cost-effective and eco-friendly alternative to fossil fuels. Biomethane, a purified form of biogas, is gaining traction as a natural gas substitute in transportation, electricity generation, and heating applications. Government policies promoting renewable energy integration, incentives for biogas production, and advancements in anaerobic digestion technology are key factors driving market adoption and expansion worldwide.

Biogas and Biomethane Market Trends

The biogas and biomethane market is witnessing significant growth due to increasing investments in renewable energy, rising environmental awareness, and stringent carbon reduction policies. Governments worldwide are supporting biogas production through subsidies, tax benefits, and feed-in tariffs, encouraging industries and farmers to invest in biogas plants. More than 50 countries have implemented biogas policies, promoting its integration into national energy grids and transportation systems.

A key trend shaping the market is the increasing adoption of biomethane as a transportation fuel. Europe leads in biomethane production, with over 700 biomethane plants in operation, supplying renewable natural gas (RNG) to transportation networks. Countries like Germany, Sweden, and the Netherlands have nationwide biomethane infrastructure, supporting compressed natural gas (CNG) and liquefied natural gas (LNG) vehicle fleets.

Another emerging trend is the co-digestion of multiple organic waste streams to optimize biogas yield. Agricultural waste, municipal solid waste, and industrial wastewater are increasingly used together in biogas plants, improving efficiency and reducing processing costs. Additionally, technological advancements in anaerobic digestion and gas upgrading are enhancing the efficiency of biomethane production, making it a viable alternative to fossil-based natural gas.

The growing interest in carbon-negative energy solutions is also accelerating biogas and biomethane adoption. Carbon capture and utilization (CCU) technologies are being integrated into biogas plants, allowing operators to capture CO₂ emissions and convert them into value-added products like biofertilizers and synthetic fuels.

Biogas and Biomethane Market Dynamics

The biogas and biomethane market is driven by growing demand for renewable energy, government incentives, and increasing adoption in transportation and power generation. However, the market faces challenges related to high capital costs, infrastructure limitations, and competition from other renewable energy sources. Technological advancements in anaerobic digestion, gas upgrading, and biogas storage are creating new opportunities for market expansion.

OPPORTUNITY

Expansion of Biomethane in Transportation Sector

The transportation sector is emerging as a key market for biomethane, with governments promoting renewable natural gas (RNG) as an alternative to diesel and gasoline. Countries like Germany, the Netherlands, and Sweden have integrated biomethane into public transportation fleets, reducing reliance on fossil fuels. More than 30% of public buses in Sweden run on biomethane, demonstrating its feasibility as a clean fuel source. The expansion of compressed biomethane refueling stations and increasing demand for low-carbon vehicle fuels present a significant growth opportunity for biomethane producers.

DRIVERS

Increasing Focus on Waste-to-Energy Initiatives

The global push for waste reduction and sustainable energy production is a key driver for the biogas and biomethane market. More than 100 million tons of organic waste are processed annually in biogas plants, helping reduce landfill waste and greenhouse gas emissions. Governments are implementing strict waste management regulations, mandating organic waste diversion from landfills into biogas production facilities. Sweden and Denmark convert over 50% of their organic waste into biogas energy, significantly reducing methane emissions from landfills.

Market Restraints

"High Initial Investment and Infrastructure Costs"

Despite its benefits, biogas and biomethane production requires high capital investments for plant construction, gas upgrading technology, and distribution infrastructure. The installation of anaerobic digesters, purification units, and gas grid injection systems can cost millions of dollars, limiting adoption in developing regions. Limited natural gas pipeline infrastructure in some countries also poses a barrier, as biomethane requires specialized transportation and storage solutions. Additionally, fluctuating feedstock availability affects biogas production efficiency, making operational costs unpredictable.

Market Challenges

"Competition with Other Renewable Energy Sources"

Biogas and biomethane face stiff competition from solar, wind, and hydrogen energy solutions, which are receiving greater policy support and investment incentives. Solar and wind power are often more cost-effective due to lower operational costs and improved energy storage technologies. Additionally, hydrogen fuel investments are increasing, attracting funding that could have otherwise supported biogas expansion. To remain competitive, biogas producers are integrating hybrid energy solutions, such as biogas-solar power plants, to diversify their renewable energy portfolios.

Segmentation Analysis

The biogas and biomethane market is segmented by type and application, catering to various feedstocks and end-use industries. The main types of biogas production include agriculture-based, sewage and wastewater-based, landfill-based, and other organic waste sources. These biogas sources are used across different sectors for electricity generation, vehicle fuel, and gas grid integration. As governments promote renewable energy policies, the demand for biogas and biomethane is rising in transportation, power generation, and industrial applications. With advancements in anaerobic digestion and biogas purification technology, the industry is expanding its reach into carbon-negative energy solutions and sustainable energy projects.

By Type

• Agriculture Type: Agriculture-based biogas production is one of the largest sources of biogas and biomethane, utilizing crop residues, manure, and food processing waste. More than 40% of global biogas plants operate on agriculture-based feedstock, primarily in Europe, China, and North America. Countries like Germany, the Netherlands, and Denmark have well-established on-farm anaerobic digestion facilities, integrating livestock manure and crop waste to produce biomethane. Agriculture-based biogas plants also contribute to sustainable farming practices by producing organic biofertilizers as a byproduct, reducing dependence on chemical fertilizers.

• Sewage and Wastewater Type: Biogas derived from sewage and wastewater treatment plants plays a significant role in urban waste management and sustainable energy production. More than 15% of global biogas production comes from municipal wastewater treatment plants, with major projects in the United States, the UK, and Japan. Cities like San Francisco and London have developed biomethane-powered public transport systems, sourcing fuel from wastewater treatment facilities. Advanced anaerobic digestion systems enable efficient biogas recovery from sewage sludge, reducing methane emissions from wastewater disposal while generating renewable electricity and heat.

• Landfill Type: Landfill-based biogas is generated from decomposing organic waste in landfill sites, making it a major source of methane recovery and renewable energy. Over 30% of biogas production in North America is sourced from landfill gas recovery projects, supplying electricity to local grids and industrial consumers. The United States, Canada, and Australia have stringent landfill methane capture regulations, driving investments in landfill-to-energy projects. Modern gas collection and purification technologies have improved landfill biogas conversion efficiency, supporting low-carbon power generation and heating applications.

• Others: Other biogas production sources include industrial food waste, breweries, and forestry residues, contributing nearly 10% of the total biogas output globally. Food waste-to-biogas plants in Sweden and France are gaining popularity as supermarkets and restaurants shift toward zero-waste initiatives. Breweries and distilleries are also adopting biogas technology to process fermentation waste, turning it into renewable energy for their operations. These emerging biogas sources present new opportunities for waste-to-energy innovation, reducing organic waste disposal costs and contributing to circular economy models.

By Application

• Electricity Generation: Biogas is widely used for electricity generation, supplying renewable power to homes, industries, and public infrastructure. More than 60% of global biogas production is utilized for electricity generation, with Germany, China, and the U.S. leading in biogas-to-power projects. Combined heat and power (CHP) systems enhance efficiency by utilizing biogas for both electricity and heat production. Many municipalities and industrial facilities are integrating biogas-based power plants to reduce dependency on fossil fuels and lower carbon emissions.

• Vehicle Fuel: The transportation sector is emerging as a key market for biomethane, offering a renewable alternative to fossil-based natural gas. Over 35% of biomethane production in Europe is used as compressed natural gas (CNG) and liquefied natural gas (LNG) for transportation. Countries like Sweden and the Netherlands have extensive biomethane-powered public transport systems, reducing reliance on diesel and gasoline. Many trucking and logistics companies are transitioning to renewable natural gas (RNG) fleets, benefiting from government incentives and carbon credits for using biomethane as vehicle fuel.

• Gas Grid Integration: Biomethane is increasingly injected into national gas grids, supplying low-carbon natural gas for residential, commercial, and industrial consumers. More than 500 biomethane injection sites are operational worldwide, with Europe leading in gas grid integration. Countries like France and Denmark have ambitious targets to replace fossil-based natural gas with biomethane, promoting net-zero energy policies. Incentives for biomethane grid injection are encouraging investments in biogas upgrading technologies, improving the quality and efficiency of biomethane for gas network distribution.

Regional Outlook

The biogas and biomethane market is expanding globally, with North America, Europe, Asia-Pacific, and the Middle East & Africa emerging as key regions for renewable energy adoption and waste-to-energy projects. Europe dominates in biogas and biomethane production, while North America is witnessing rapid investments in renewable natural gas (RNG) infrastructure. Asia-Pacific is growing significantly, driven by China and India’s focus on biogas for rural electrification. The Middle East & Africa region is gradually integrating biogas technology into agricultural and municipal waste management projects, presenting new growth opportunities.

North America

North America is a fast-growing market for biogas and biomethane, driven by government incentives, the adoption of renewable natural gas (RNG), and increasing demand for clean energy. The United States leads the market, with over 2,200 biogas plants, including agriculture-based digesters, wastewater treatment plants, and landfill gas recovery systems. California has invested heavily in biomethane refueling stations, supporting renewable CNG (R-CNG) for transportation. Canada is expanding its biogas production capacity, with provinces like Ontario and British Columbia promoting biomethane integration into national gas grids.

Europe

Europe is the largest producer of biogas and biomethane, accounting for over 50% of global production. Germany is the market leader, with over 9,500 biogas plants, producing biomethane for electricity, heating, and transportation. The UK and France are increasing investments in anaerobic digestion technology, while Italy and Denmark are prioritizing carbon-neutral biomethane in public transportation. The European Union’s Renewable Energy Directive is accelerating the transition to biogas and biomethane-based energy, encouraging investments in waste-to-energy projects and sustainable agricultural practices.

Asia-Pacific

Asia-Pacific is witnessing rapid growth in the biogas and biomethane market, with China, India, and Japan leading production. China has over 6,000 large-scale biogas plants, integrating agricultural and industrial waste into bioenergy production. India is investing in biogas for rural electrification, with the National Biogas and Manure Management Programme (NBMMP) supporting household and community-scale digesters. Japan is focusing on biomethane as an alternative fuel for hydrogen production, aligning with its carbon-neutral energy transition goals. Southeast Asian countries like Thailand and Indonesia are expanding biogas projects in palm oil and livestock industries.

Middle East & Africa

The Middle East & Africa is an emerging market for biogas and biomethane, with countries investing in renewable energy and waste management solutions. South Africa leads in biogas adoption, integrating agricultural and landfill gas projects into its energy sector. The UAE and Saudi Arabia are piloting biomethane-based energy solutions, leveraging food waste and wastewater treatment plants. In North Africa, Egypt and Morocco are expanding biogas digesters in rural areas, improving off-grid electricity access and sustainable farming practices.

LIST OF KEY BIOGAS AND BIOMETHANE MARKET COMPANIES PROFILED

Investment Analysis and Opportunities

The biogas and biomethane market is attracting significant investments as governments and private companies focus on renewable energy solutions and carbon reduction strategies.

• The European Union allocated over $2 billion for biogas plant expansion and biomethane integration into national grids.
• The U.S. government invested $1.5 billion in renewable natural gas (RNG) projects, supporting biomethane-powered transportation and heating applications.
• China committed $800 million to develop agricultural waste-based biogas plants, targeting rural electrification and industrial energy transition.
• Major energy firms like Shell and BP are investing in biogas as a low-carbon fuel alternative, funding projects worth over $500 million.
• Private equity firms are financing next-generation biogas startups, focusing on waste-to-energy innovations and carbon-negative biomethane production.

Opportunities lie in hybrid biogas-solar energy systems, AI-driven biogas plant monitoring, and blockchain-based carbon credit trading for biomethane producers.

New Products Development

• VERBIO launched an advanced biogas purification system, reducing CO₂ emissions and improving biomethane conversion efficiency by 30%.
• Nature Energy developed a modular anaerobic digestion plant, allowing faster deployment and lower installation costs.
• Gasrec introduced a bio-LNG fuel station network, expanding biomethane access for heavy-duty transport and logistics companies.
• Thorso Biogas introduced an AI-based feedstock optimization system, increasing biogas yield and process efficiency.
• Future Biogas launched a carbon-negative biomethane production model, integrating carbon capture technology into existing biogas plants.

Manufacturers are focusing on improving biogas efficiency, reducing carbon intensity, and expanding biomethane production for diverse applications.

Recent Developments by Manufacturers in Biogas and Biomethane Market

1. VERBIO expanded its biomethane production capacity, increasing output by 20% in Germany and North America.
2. Nature Energy partnered with a leading European gas grid operator, facilitating seamless biomethane injection into national pipelines.
3. Gasrec launched a large-scale bio-LNG production facility, catering to growing demand for renewable transport fuels.
4. Asia Biogas secured funding for a new anaerobic digestion plant in Thailand, increasing biogas production from agricultural waste.
5. Shandong Minhe developed a livestock waste-to-biogas conversion project, supplying clean energy to rural communities in China.

REPORT COVERAGE

The biogas and biomethane market report provides a detailed analysis of industry trends, technological advancements, and investment opportunities. The report includes:

• Market Segmentation: Covers biogas types (landfill gas, wastewater-based, agricultural waste-based) and applications (electricity generation, transportation, heating, industrial use).
• Regional Analysis: Insights into North America, Europe, Asia-Pacific, and Middle East & Africa, focusing on biogas adoption rates, government policies, and market developments.
• Competitive Landscape: Profiles of key market players, their investment strategies, and technological innovations.
• Investment Trends: Details on global biogas and biomethane funding, government incentives, and corporate renewable energy initiatives.
• Technology Advancements: Covers next-gen anaerobic digestion systems, AI-driven biogas monitoring, and biomethane purification technologies.
• Regulatory Frameworks: Analysis of global biogas policies, carbon trading mechanisms, and sustainability certifications.

The report is essential for renewable energy investors, biogas plant operators, and policymakers, providing strategic insights to drive market expansion and sustainability initiatives.