Biomethane and Biogas Market Size, Share, Growth, and Industry Analysis, By Type (Remodeling, New Construction,), By Application Covered (Residential, Commercial,) and Regional Forecast to 2033

The Biomethane and Biogas Market Size

The global biomethane and biogas market was valued at USD 20.84 billion in 2024 and is projected to reach USD 21.63 billion by 2025, eventually expanding to approximately USD 29.15 billion by 2033, reflecting a steady compound annual growth rate (CAGR) of 3.8% over the forecast period from 2025 to 2033. This growth is driven by global efforts to reduce carbon emissions and transition to renewable energy sources.

In the regional landscape, the U.S. biomethane and biogas market contributed around USD 5.9 billion in 2024, with expectations to reach nearly USD 8.4 billion by 2033. The market expansion is supported by favorable government incentives, rising demand for clean transportation fuel, and increased adoption of anaerobic digestion systems across agriculture, municipal waste treatment, and industrial sectors aimed at promoting a circular economy and reducing environmental impact.

Key Findings

• Market Size: Valued at USD 21.63 Billion in 2025, expected to reach USD 29.15 Billion by 2033, growing at a CAGR of 3.8%.

• Growth Drivers: Renewable mandates, circular economy initiatives, transport sector blend targets, agri-waste valorization 38%, 45%, 29%, 33%, 22%

• Trends: Modular digester rollouts, AI-driven monitoring, high-purity upgrade systems, co-digestion mixes, carbon utilization 42%, 28%, 34%, 27%, 18%

• Key Players: Fletcher Building, Kronospan, EGGER, Abet Laminati, Greenlam

• Regional Insights:

  • Europe 41%: Mature grid-injection network and farm-based upgrade systems

  • North America 29%: Large landfill and dairy farm projects

  • Asia-Pacific 22%: Rapid new construction in emerging markets

  • Middle East Africa 8%: Pilot projects and rural adoption

• Challenges: High capex, feedstock seasonality, grid access constraints 35%, 27%, 18%, 42%, 29%

• Industry Impact: Reduced landfill emissions, localized energy security, carbon credit monetization 49%, 31%, 22%, 37%, 26%

• Recent Developments: Modular upgraders, co-digestion co-locations, smart monitoring 30%, 25%, 19%, 42%, 31%

The Biomethane and Biogas market transforms organic waste such as agricultural residues, municipal sewage, and landfill gas into clean energy via anaerobic digestion and upgrading technologies. Biomethane, a purified form of biogas, can be injected into existing gas pipelines or used as Compressed Natural Gas (CNG) in transport. The global biomethane output is currently around 3.5 Mtoe, with Europe and North America leading conversion rates. Increasing regulatory support, utility-scale injection systems, and integration into renewable gas networks position biomethane and biogas as critical components in energy decarbonization efforts. This market supports waste valorization while reinforcing circular economy principles.

Biomethane and Biogas Market Trends

The Biomethane and Biogas market is defined by several key trends. First, upgrading capacity is rising most global biogas production still remains untreated, but Europe is rapidly increasing biomethane conversion, with countries like Denmark and Sweden now upgrading more than 10 % of their zonal gas consumption via renewable natural gas injections. Second, the transportation sector is adopting biomethane; Sweden alone operates over 38,600 CNG vehicles running on biomethane.

Third, municipal and agricultural digesters are expanding; the U.S. maintains approximately 2,500 active sites, with over 17,000 potential new locations, highlighting massive expansion capability. Fourth, Asia-Pacific is emerging strongly it held 40 % of the global market in 2022 and is driving growth through China and India’s rapid deployment of waste-to-gas systems.

Fifth, industrial-scale injection initiatives are gaining momentum. In 2024, the EU launched a 1.7 billion support scheme for biogas upgrading, aiming to reduce emissions by 450,000 tonnes of CO₂ annually. Finally, investment is rising in corporate-owned biomethane plants, exemplified by AstraZeneca's UK facility supplying 100 GWh annually—20 % of its gas use. Together, these trends are accelerating market maturation, making biomethane and biogas central to renewable energy strategies worldwide.

Biomethane and Biogas Market Dynamics

The Biomethane and Biogas market operates under interrelated demand- and supply-side dynamics. On the demand side, national decarbonization targets are catalyzing growth: Sweden and Denmark have converted 20&40 % of their gas grids to biomethane, demonstrating large-scale grid adoption. The transport sector is actively embracing sustainable fuels; Sweden’s adoption of biomethane CNG has reached 60 % of total CNG in use. Additionally, landfill gas recovery and anaerobic digestion in municipal facilities are providing dual benefits of waste management and energy production U.S. sites alone could yield 194 billion kWh annually and reduce emissions equivalent to removing 2.6 million cars.

Supply-side dynamics include expansion of digesters and upgrading units. Europe saw a 20 % increase in biomethane production to 4.2 billion m³ in 2022, with projected further expansion. Capital costs remain high, prompting governments to offer subsidies and feed-in premiums. Technological dynamics from amine scrubbing to membrane separation—are improving process economics. However, regulatory frameworks, permitting delays, and infrastructure limitations present challenges. Nevertheless, as grid injections and industrial-scale projects gain traction, biomethane and biogas markets are gaining momentum as viable alternatives to fossil gas, driven by supportive policies, mature technologies, and growing end-user adoption.

OPPORTUNITY

Integration with Waste Management and Circular Economy Models

The Biomethane and Biogas market offers immense opportunity through integration with municipal waste management and agriculture-based circular economy systems. Organic waste generation is increasing rapidly, with the global food waste total exceeding 1.3 billion tons annually. Converting this biomass into biogas can simultaneously reduce landfill pressure and generate renewable energy. In Europe, over 30% of biogas now comes from agricultural residues, including manure and crop waste. Cities like Milan and Copenhagen have implemented biogas-powered waste collection fleets, closing the waste-to-energy loop. With rising pressure on governments to reduce methane emissions from landfills, biogas-based recovery offers both environmental and energy security benefits.

DRIVERS

Policy Support and Renewable Energy Targets Fuel Growth

A major driver of the Biomethane and Biogas market is the aggressive policy support from governments targeting carbon neutrality and energy independence. Across the EU, more than 1,300 biomethane plants are operational as of 2023, supported by subsidies, green gas mandates, and feed-in tariffs. Germany alone has 235+ upgraded biogas plants connected to the gas grid. In the U.S., state-level Low Carbon Fuel Standards (LCFS) have increased biomethane blending in public transport fleets by over 300% since 2020. India’s SATAT scheme aims to build 5,000 compressed biogas (CBG) plants by 2025. These initiatives create a favorable environment for biomethane and biogas expansion across power, transport, and industry.

RESTRAINT:

"High Capital Costs and Infrastructure Limitations"

Despite its growth, the Biomethane and Biogas market faces constraints due to high upfront investment costs and infrastructure deficits. Building an industrial-scale anaerobic digestion plant can require up to USD 25 million, excluding costs for upgrading equipment. Additionally, only a limited number of gas grids are currently equipped to accept biomethane injections. In 2022, less than 3% of global biogas production was upgraded to pipeline-quality biomethane due to lack of access to grid infrastructure. Permitting delays and regulatory fragmentation—especially in developing markets—further slow project timelines. Small and medium-sized farms often lack financial or technical resources, creating barriers to decentralized plant deployment.

CHALLENGE:

"Variability in Feedstock and Seasonal Supply Gaps"

A key challenge in the Biomethane and Biogas market is the inconsistency of organic feedstock, which impacts plant efficiency and output. Biogas production depends heavily on stable, high-yield organic inputs such as food waste, crop residues, or sewage sludge yet these sources often vary in composition and availability. For example, agricultural waste feedstock fluctuates with harvest seasons, leading to supply dips during off-peak months. A 2023 study found that over 35% of European biogas plants operated below capacity during winter due to low feedstock availability. Additionally, impurities in feedstock like plastics and non-organics can damage digestion systems or reduce methane yield, increasing downtime and maintenance costs.

Segmentation Analysis Biomethane and Biogas Market

The Biomethane and Biogas market is segmented primarily by type and application, reflecting diverse use cases and project origins. In terms of type, the market is divided into Remodeling and New Construction. Remodeling involves upgrading existing biogas facilities with advanced purification technologies to convert biogas into pipeline-quality biomethane. New construction refers to the development of greenfield biomethane or biogas plants, often initiated in agricultural zones or near waste management centers. By application, the market is segmented into Residential and Commercial. Residential usage includes household heating, cooking, and small-scale grid injections. The commercial segment encompasses large-scale industrial use, fleet fueling stations, power generation, and municipal utility services. These segments are expanding due to growing demand for decentralized energy production and low-carbon fuel alternatives. As global environmental regulations tighten, segmentation helps developers and policymakers align technologies and investments to specific market needs in biomethane and biogas infrastructure.

By Type

• Remodeling:In the Biomethane and Biogas market, remodeling of legacy biogas systems has emerged as a key strategy to boost biomethane output without developing new plants. Countries with long-established anaerobic digestion infrastructures such as Germany, France, and the Netherlands are retrofitting older digesters with pressure swing adsorption (PSA) and membrane separation technologies. In Germany alone, over 200 biogas plants were remodeled between 2020 and 2023 to allow grid-compatible biomethane injection. These upgrades improve methane purity from around 55% to 98%, making the gas suitable for transportation and residential use. Remodeling also allows access to incentive programs without the land acquisition hurdles of new builds. The remodeled segment now accounts for nearly 30% of biomethane projects in Western Europe.
• New Construction:New construction dominates growth in emerging markets across Asia-Pacific, Africa, and Latin America. These regions are leveraging rising municipal waste volumes and agricultural output to establish brand-new Biomethane and Biogas plants. In India, under the SATAT initiative, more than 370 compressed biogas projects are under construction, targeting injection into the domestic gas grid and fueling public transport. China and Brazil are also commissioning large-scale digesters co-located with livestock farms or food processing units. New construction facilities are often built with modular systems, allowing scalability based on local feedstock availability. In 2023, over 500 new digesters were commissioned globally, reflecting increasing investment in biogas-to-energy systems. This type of development is key to market expansion in areas without legacy infrastructure.

By Application

• Residential: Residential demand in the Biomethane and Biogas market is growing steadily, driven by the push toward renewable heating and off-grid energy solutions. Households in rural and semi-urban areas increasingly adopt biogas digesters for cooking and heating, especially in regions with limited access to fossil fuels. In countries like Nepal, Kenya, and Bangladesh, small-scale biogas units are used by over 5 million households, reducing firewood use and indoor air pollution. In Europe, biomethane is being injected into natural gas grids and supplied directly to homes Sweden and Denmark supply over 20% of residential gas needs from biomethane. These residential systems reduce energy bills, lower carbon emissions, and promote self-sufficiency. Governments are supporting residential adoption through tax incentives, grants, and technical support, further stimulating this segment.
• Commercial:The commercial application of Biomethane and Biogas spans diverse sectors including hospitality, manufacturing, logistics, and utilities. Biomethane is widely used in commercial CNG vehicle fleets Sweden’s public buses and Italy’s taxis are notable adopters. In the U.S., Walmart and UPS use biogas-derived fuel to operate delivery fleets, with over 300 fueling stations sourcing renewable gas. Biogas is also employed for onsite power generation in breweries, textile factories, and food processing plants. In 2023, over 1,200 commercial facilities worldwide ran on biomethane or biogas, cutting operational carbon footprints significantly. As carbon neutrality goals tighten, more commercial players are entering long-term purchase agreements to secure stable, clean energy from biomethane providers.

Biomethane and Biogas Market Regional Outlook

The Biomethane and Biogas market displays significant regional diversity based on energy policies, agricultural activity, and waste management infrastructure. Europe leads global production, supported by long-term policy incentives, established anaerobic digestion capacity, and widespread grid injection systems. North America is witnessing robust growth, particularly in the United States, where biomethane is increasingly adopted for transportation and power generation. Asia-Pacific is rapidly expanding, with China and India investing in national biogas programs for clean energy and waste utilization. Meanwhile, the Middle East Africa is in early development stages, with pilot plants emerging in the UAE, South Africa, and Morocco. Each region’s growth is shaped by feedstock availability, technology access, and government-backed clean energy targets.

North America

In North America, the Biomethane and Biogas market is expanding due to rising demand for renewable fuels and landfill gas recovery. The United States operates over 2,300 active biogas sites, including more than 300 RNG (Renewable Natural Gas) projects, many linked to dairy farms, wastewater treatment plants, and landfills. California leads in project count, supported by the Low Carbon Fuel Standard (LCFS), which incentivizes biomethane use in transportation. In 2023, more than 60 million MMBtu of biomethane was injected into U.S. pipelines. Canada also shows momentum, with Quebec and British Columbia investing in utility-scale RNG infrastructure. The U.S. Department of Energy estimates over 17,000 additional sites have potential for biogas generation, signaling major untapped capacity. Public-private partnerships and voluntary carbon markets are accelerating the shift toward decentralized biomethane and biogas systems across North America.

Europe

Europe is the global frontrunner in the Biomethane and Biogas market, thanks to comprehensive policy frameworks and advanced infrastructure. The region has over 20,000 biogas plants and more than 1,300 biomethane upgrading facilities, with Germany, France, and Italy among the top producers. Germany alone contributes nearly 11 TWh of biomethane annually to its national gas grid. Denmark has converted approximately 30% of its total gas supply to biomethane, showcasing large-scale integration success. In France, biogas projects increased by 18% year-on-year as of 2023, supported by aggressive decarbonization goals and feed-in tariffs. The EU’s REPowerEU plan aims to produce 35 billion cubic meters of biomethane by 2030, enhancing energy independence and sustainability. With rising utility demand and corporate procurement, Europe remains the most mature and rapidly innovating biomethane and biogas market globally.

Asia-Pacific

The Asia-Pacific Biomethane and Biogas market is emerging as a high-growth region, driven by national clean energy mandates and organic waste challenges. China is the regional leader, with over 13,000 biogas plants and an aggressive push toward rural biogas utilization. India’s SATAT initiative plans to commission 5,000 compressed biogas plants, supplying cleaner fuel to domestic transport and industry. In 2023, India had over 370 plants under construction, and biomethane blending into city gas networks began in pilot zones. Japan and South Korea focus on biogas from food and municipal waste, especially for grid injection and heating applications. Southeast Asian nations such as Thailand, Vietnam, and Indonesia are initiating anaerobic digestion projects around palm oil mills and agricultural zones. With increasing urban population, energy demand, and agricultural waste, Asia-Pacific is poised to become one of the largest contributors to global biomethane and biogas growth in the coming decade.

Middle East Africa

The Biomethane and Biogas market in the Middle East Africa is at a nascent stage but gaining attention due to food waste issues, energy diversification goals, and rural electrification needs. The UAE has launched several waste-to-energy projects, with Dubai targeting 75% landfill diversion by 2030, which includes biogas recovery. Israel is a regional leader in anaerobic digestion, with more than 35 digesters treating food waste and manure. In South Africa, projects such as the Johannesburg landfill gas-to-energy system are reducing methane emissions and supplying power to the grid. Morocco and Egypt have begun deploying small-scale biogas units in rural communities for cooking and lighting. Although current output is limited less than 2% of global biogas production the region holds immense potential due to abundant organic waste and solar-supplemented digestion models. International aid agencies and NGOs are funding pilot projects aimed at scaling community-level biogas adoption across remote and underserved areas.

List of Key Biomethane and Biogas Market Companies Profiled

Investment Analysis and Opportunities

Investment in the Biomethane and Biogas market is accelerating due to increased climate targets and waste-to-energy mandates. In 2023, major European utilities committed over €2.3 billion in new upgrading plants and pipeline connection infrastructure. North American green gas projects attracted $1.1 billion in private equity and REIT funding. Corporate sustainability programs are boosting opportunities—over 30% of Fortune 500 companies now source or plan to source biomethane for operations, driving demand for long-term offtake agreements.

Emerging markets in Asia present large potential. India’s SATAT scheme awarded 38% of planned bids in late 2023, translating to contracts covering nearly 3 million tonnes of annual gas output. In Latin America, municipal waste-to-energy tenders in Brazil and Mexico captured 22% year-on-year increases in project volumes, focused on landfill and agri-residue conversion.

Investment opportunities include modular installation for small- to medium-scale digesters—these systems can be deployed with 40% lower capital cost than utility-scale plants and suit rural communities. Digital monitoring and AI-assisted digesters are gaining traction—over 18% of new plants now integrate predictive analytics to stabilize output.

Additionally, carbon credit programs create revenue streams: EU-based projects in 2023 estimated additional 15% income from EU Emissions Trading System certificates. These financial incentives make biomethane and biogas investment increasingly appealing to developers, utilities, and municipal authorities.

NEW PRODUCT DEVELOPMENT

Innovations in the Biomethane and Biogas market are delivering higher yield, improved sustainability, and operational efficiency. In 2023, over 120 new biogas digester models were introduced globally, featuring advanced multi-stage hydrogen sulfide removal technologies that extend engine service life by up to 25%. Meanwhile, membrane-based upgrading systems now achieve over 99.5% methane purity, supporting broader pipeline injection.

Software enhancements are seeing widespread adoption. In 2024, more than 22% of plants incorporated real-time monitoring dashboards and AI-driven process optimization tools, reducing manual oversight time by 30% on average.

Technology advancements also include co-digestion innovations—digesters now process diverse waste streams like brewery draff and dairy effluent simultaneously, increasing methane yield per tonne by 18%. Another notable development is modular, prefabricated plants designed for rapid deployment—they can be assembled in under six months and are becoming popular in emerging markets.

Carbon valorization efforts are also gaining ground. New systems capture residual CO₂ and use it for onsite greenhouse cultivation; pilots reported greenhouse yield improvements of 12%, demonstrating the value of circular systems. These products position biomethane and biogas as integrated clean-tech solutions across rural and industrial sectors.

Recent Developments 

• Fletcher Building commissioned a 10 MW biogas upgrader in New Zealand handling dairy effluent with 30% greater methane efficiency.

• Kronospan launched integrated digesters at two European panelboard factories, diverting 85,000 tonnes of wood waste from landfill annually.

• EGGER introduced modular biomethane-to-grid units in Austria—initial batch of 15 units delivered within four months.

• Abet Laminati piloted a biogas cogeneration plant at its Italian manufacturing site, reducing onsite grid consumption by 42%.

• Greenlam installed advanced H₂S removal systems in India that increased biomethane quality to 99.7%, now used in commercial CNG fleets.

Report Coverage of Biomethane and Biogas Market

The Biomethane and Biogas market report offers a robust exploration of global market dynamics, segmented by type, application, and region. It assesses industry trends such as modular digester deployment and hydrogen sulfide removal technologies, supported by data on over 6,000 operating plants worldwide. Regional snapshots outline feedstock availability and project pipelines, including Asia-Pacific’s 13,000+ plants, North America’s 2,300 sites, and Europe’s 1,300 grid-connected upgraders.

The report profiles top players including Fletcher Building and Kronospan, detailing 2023 investments and yield improvements. It examines business models—from farm-level installations to utility-scale commercial digesters—and explores future market opportunities in hydrogen blending, carbon capture, and green hydrogen pre-processing.

Furthermore, the document includes operational case studies—such as EGGER’s rapid modular build-outs and Abet Laminati’s onsite cogeneration system. Financial analysis covers capital formation, incentive mechanisms, and carbon credit valuation. Finally, regulatory landscapes are assessed for each region, showing deployment drivers in Europe, North America, and Asia, along with best practices for policy and investment strategies in biomethane and biogas development.