Biogas And Biomethane Market Size, Share, Growth and Industry Analysis, By Type (Agriculture Type, Sewage and Wastewater Type, Landfill Type, Others), By Application (Electricity Generation, Vehicle Fuel, Gas Grid), Regional Insights and Forecast From 2026 To 2035

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BIOGAS AND BIOMETHANE MARKET OVERVIEW

The global biogas and biomethane market size was estimated at USD 92.44 billion in 2026 and expected to rise to USD 106.58 billion by 2035, experiencing a CAGR of 1.5% during the forecast period from 2026 to 2035.

Natural gas known as biomethane is created when organic matter, including sewage, manure, plant and animal waste, and green and industrial waste, is gasified or anaerobically respired. Biomethane is created by extracting high-calorific methane from biogas. In addition to lowering greenhouse gas emissions, biomethane has potential uses in the power generation of the car industry. Importantly, there are no extra production expenses because biomethane is generated utilizing the same infrastructure as natural gas.

The market for biogas and biomethane has been expanding as a result of government programs encouraging sustainable behaviors, growing knowledge of renewable energy sources, and efforts to lower greenhouse gas emissions. Anaerobic digestion of organic waste produces biogas, and biomethane is a refined version of biogas that may be fed into natural gas pipelines or utilized as fuel for automobiles.

KEY FINDINGS

COVID-19 IMPACT

COVID-19 Provoked Investment Challenges, Project Delays and Changes in Policies Downgraded the Market Growth 

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to market’s growth and demand returning to pre-pandemic levels.

LATEST TRENDS

Adoption of Biomethane in Transportation to Electrify the Market Growth

Businesses are realizing more and more how integrating biogas and biomethane into their operations may benefit them both environmentally and financially. This includes putting biomethane in their fleet of vehicles or using biogas to generate electricity on-site. As a sustainable car fuel, biomethane is becoming more and more popular, especially in the transportation industry. This tendency is facilitated by the establishment of infrastructure for biomethane refueling and by government regulations that are in favor of it.

• According to the European Commission Directorate-General for Energy, Europe operates more than 1,300 biomethane plants, compared to fewer than 500 plants in 2011, reflecting significant infrastructure expansion. The European Biogas Association (EBA) reports that total biogas production in Europe exceeds 18 billion cubic meters (bcm) annually, with a growing share upgraded to grid-quality biomethane containing over 95% methane concentration. This reflects a clear shift toward advanced upgrading technologies and grid injection systems.

• According to the International Energy Agency (IEA), global biomethane production reached approximately 7 bcm per year, with Europe accounting for over 75% of grid-injected volumes. The UK Department for Energy Security and Net Zero reports that more than 120 biomethane plants are connected to the UK gas grid, supplying renewable gas equivalent to the heating needs of over 1 million homes annually. The expansion of injection infrastructure highlights growing policy support for renewable gas substitution.

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BIOGAS AND BIOMETHANE MARKET SEGMENTATION

By Type

Based on type the global market can be categorized into agriculture type, sewage and wastewater type, landfill type and others.

• Agricultural Biogas: The main source of agricultural biogas is organic waste from farming operations, such as crop leftovers, manure, and organic byproducts. In the absence of oxygen, anaerobic digestion is frequently used to break down organic waste and produce biogas, which may be converted to biomethane and injected into natural gas pipelines for use as fuel or power.

• Wastewater and Sewage Biogas: Organic material produced by wastewater treatment facilities and sewage sludge can be used as feedstock for biogas generation. Sewage treatment facilities frequently use anaerobic digestion to treat sludge, with the result being biogas.

• Landfill Biogas: Organic waste that has been buried in a landfill breaks down to create biogas. Usually, methane and carbon dioxide make up landfill gas. It may be gathered and utilized to provide energy; in certain situations, the gas is refined to yield biomethane.

• Other Types: In addition to agricultural waste, biogas may be produced using other organic waste streams such food waste, green waste, and organic industrial waste. Organic waste or byproducts from some industrial operations can be utilized to produce biogas. Through anaerobic digestion or other methods, the organic portion of municipal solid waste can be converted into biogas.

By Application

Based on application the global market can be categorized into electricity generation, vehicle fuel and gas grid.

• Electricity Generation: Power stations may utilize biogas as a fuel to produce energy. Biogas may be used to create power in motors or turbines that can be supplied into the grid or consumed locally. In combined heat and power systems, biogas is frequently used to capture and use produced heat for heating, thereby increasing total energy efficiency.

• Vehicle Fuel: Biomethane, or refined biogas, is a sustainable fuel for vehicles. It may be either compressed and utilized in automobiles as compressed natural gas (CNG) or liquefied and used as liquefied natural gas (LNG). The development of bio-CNG and bio-LNG dispensing infrastructure is aimed at facilitating the use of biomethane as a sustainable substitute for conventional fossil fuels in the transportation industry.

• Gas Grid Injection: After undergoing a rigorous purification process, biomethane may be injected straight into pipes carrying natural gas. Biomethane may now be supplied through the current gas infrastructure and used for a variety of purposes thanks to this method. By providing a low-carbon and renewable alternative to conventional natural gas, biomethane injection into the gas grid aids in the decarbonization of natural gas.

DRIVING FACTORS

Rising Environmental Concerns to Brace Up the Market Growth

The fact that biomethane contributes to the reduction of greenhouse gas emissions is one of its main drives. The effect that biomethane has on Earth's atmosphere is without a doubt one of its most important environmental advantages. Because carbon dioxide and other gases that contribute to the greenhouse effect are released during the breakdown of organic matter, biomethane, unlike traditional energy sources, does not increase the concentration of greenhouse gasses. Put another way, one of the best methods to meet the growing energy demand without causing global warming, which puts all living things, including people, in risk, is through the use of biomethane.

Government Offered Incentives and Subsidies to Intensify the Market Growth

The process of producing biogas and biomethane offers a locally produced alternative energy source. As a result, there may be less reliance on imported fossil fuels, improving energy security. Globally, governments provide grants, financial incentives, and subsidies to encourage the creation and execution of biogas and biomethane projects. These incentives contribute to the economic viability of such undertakings.

• According to the World Bank, global municipal solid waste generation exceeds 2.2 billion metric tons per year, and organic waste accounts for approximately 44% of this total. The Food and Agriculture Organization (FAO) estimates that nearly 1.3 billion metric tons of food waste are generated annually worldwide. These organic streams provide substantial feedstock for anaerobic digestion facilities, strengthening the raw material base for biogas and biomethane production.

• According to the United Nations Framework Convention on Climate Change (UNFCCC), over 190 countries have submitted nationally determined contributions (NDCs) aimed at reducing greenhouse gas emissions. The European Environment Agency (EEA) reports that methane accounts for approximately 12% of total EU greenhouse gas emissions, with agriculture and waste being primary sources. Anaerobic digestion systems can capture methane with efficiencies exceeding 90%, converting emissions into usable energy and supporting national decarbonization objectives.

RESTRAINING FACTORS

High Combustible Nature of the Gas to Limit the Market Growth

Methane (CH4) is a very explosive gas that has no color and no smell. Water vapor and carbon dioxide are released as it burns. It is possible to make it artificially or organically. Natural gas is used as the primary component in the production of heat and power worldwide. Methane undergoes chemical reactions to form carbon black, a chemical component found in some tire rubber varieties. One reason this is a limiting element is the amount of care and attention required in the manufacturing and delivery of biomethane. However, the issues with the high combustible nature of biomethane may restrict the worldwide biogas and biomethane market growth.

• According to the International Renewable Energy Agency (IRENA), establishing a medium-scale anaerobic digestion plant with a capacity of 1–2 megawatts (MW) requires significant upfront investment, including digesters operating at temperatures of 35°C to 55°C for optimal microbial activity. The U.S. Environmental Protection Agency (EPA) AgSTAR program reports that there are over 2,200 livestock farms in the U.S. suitable for biogas systems, yet only around 400 operational digesters, highlighting financial and technical barriers limiting broader adoption.

• According to the Food and Agriculture Organization (FAO), agricultural productivity can fluctuate by more than 10% annually due to weather variability. The UK Department for Environment, Food & Rural Affairs (DEFRA) reports that manure and crop residue collection efficiency can drop below 70% in dispersed rural areas, increasing transportation and handling complexity. Such feedstock inconsistencies can affect stable biogas yields, which typically range between 20 to 40 cubic meters per ton of organic waste, depending on composition.

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BIOGAS AND BIOMETHANE MARKET REGIONAL INSIGHTS

Europe Being a Leading Player with Supportive Government Regulations to Dominate the Market Share

The market is primarily segregated into North America, Latin America, Europe, Asia Pacific, and the Middle East & Africa.

Europe is anticipated to lead with around 35%–40% of the market between 2026 and 2035, The biogas and biomethane market share in Europe is the largest in the world. The need for biogas for applications that generate electricity has increased as a result of environmental awareness, technical developments, and increased demand for biogas. Additionally, the region's fast urbanization and industrial expansion and development are elements that account for its major market share. Manufacturers in the biomethane sector can make a substantial revenue because of advantageous government laws in Europe. Europe has been a market leader for biogas and biomethane, having adopted regulatory frameworks, incentives, and supporting policies in a number of its member states. Particularly in Germany, the biogas industry is well-established. The European Union's dedication to decarbonization and renewable energy has stimulated investment in these technologies.

KEY INDUSTRY PLAYERS

Notable Market Players Shaping the Market and Contributing in the Market Expansion

Due to their significant market influence, major market players are essential for understanding consumer preferences and industry dynamics. Because of these big companies' extensive retail networks and online platforms, customers may easily browse through an enormous variety of clothing selections. Due to their strong global presence and well-known brand, which have also strengthened customer loyalty and confidence, product adoption has increased. 

• Gasrec (U.K.): According to data aligned with the UK Department for Transport, the United Kingdom operates more than 1,000 biomethane-powered heavy goods vehicles (HGVs), with renewable gas capable of reducing greenhouse gas emissions by up to 85% compared to diesel on a lifecycle basis. Gasrec supplies biomethane fuel through dedicated refueling stations across key logistics corridors in the UK, supporting fleet operators seeking compliance with emission reduction targets. The UK gas grid includes over 284,000 kilometers of pipelines, enabling renewable gas distribution nationwide.

• Future Biogas (U.K.): According to the UK Department for Energy Security and Net Zero, anaerobic digestion contributes significantly to renewable electricity and gas output, with the UK hosting more than 650 anaerobic digestion plants. Future Biogas develops and operates subsidy-free biomethane facilities designed to inject gas directly into the national grid. Typical UK farm-based digestion facilities process tens of thousands of tons of feedstock annually and can generate renewable gas sufficient to supply several thousand households per plant, depending on scale.

List of Top Biogas And Biomethane Companies

• Gasrec (U.K.)
• Future Biogas (U.K.)
• VERBIO (Germany)
• Thorso Biogas (Denmark)
• Staples Vegetables (U.K.)
• Nature Energy (Denmark)
• Asia Biogas (Thailand)
• Deqingyuan (China)
• Mengniu (China)
• Shandong Minhe (China)
• J V Energen (U.K.)
• AltEnergo (Ukraine)
• Bayo-Tech and IBMS Group (U.K).

INDUSTRIAL DEVELOPMENT

May 2021: IBMS Group and Bayo-Tech declared their collaboration. It will help them start a project that uses biomethane from food waste to make sustainable hydrogen.

REPORT COVERAGE

The research provides forecasts for future market expansion in addition to a comprehensive SWOT analysis. It examines a wide range of market classifications, potential uses, and important factors that fuel the market's expansion in order to determine how the industry develops over the next several years. By considering both historical turning points and current trends, the research offers a thorough picture of the market's components and highlights potential growth prospects.