Biomethane Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2025 - 2030)

Biomethane Market Size

Biomethane Market Trends and Growth Drivers

Increasing Usage in Transportation Is Key Driver for Market

• One major reason for market growth is the increasing usage of biomethane in transportation.
• Generally, biomethane is best for heavy-duty vehicles such as buses and trucks due to its high density when liquefied or compressed. Therefore, strict environmental regulations in logistics and public transportation are driving its adoption as a cleaner fuel alternative.
• Moreover, fleet operators in waste management and public transportation are increasingly adopting bio-menthane-powered vehicles. This rise of dual-fuel and dedicated biomethane options enables companies, to transition their fleets, meeting emission targets and boosting sustainability efforts.
• Adding on, the transportation sector is a major source of global greenhouse gas emissions. Hence biomethane, which is a natural gas, provides a cleaner alternative to diesel and petrol, reducing CO2, particulate emissions, and nitrogen oxides, supporting global carbon footprint reduction efforts.

Transforming Waste into Renewable Energy Is Key Trend in Market

• The production of biomethane promotes the circular economy by converting organic waste into energy resources, which helps in increasing resource efficiency.
• By turning trash, which produces methane upon decomposition, into biomethane, greenhouse gas emissions can be decreased.
• Methane, in particular, has the potential to inflict great harm on the environment.
• Several industries are focusing on lowering their carbon footprint and adopting more eco-friendly practices.
• Additionally, biomethane is considered an effective alternative to fossil fuels, particularly in industries where reducing carbon emissions is challenging.

Sustainable Energy and Economic Growth Through Renewable Gas Solutions are Key Market Drivers

• Biomethane is produced from organic waste such as municipal waste agricultural residues, and animal manure, hence promoting environmental stability. This waste-to-energy process reduces landfill usage, cuts methane emissions, and supports circular economy practices, aligning with the global trends in sustainable resource management.
• Moreover, the transportation and power generation sectors are major carbon emitters. Biomethane offers a renewable fuel alternative, especially for hard-to-decarbonize areas like heavy transport and industry. It can be utilized as LNG, CNG, or can be injected into natural gas grids, which help in decarbonizing existing energy infrastructure.
• Adding on, expanding biomethane production simulates economic growth by generating jobs across the value chain, from production to distribution and maintenance. Rural areas gain considerably, as biomethane projects use agricultural residues and animal manure, supporting rural development and encouraging sustainable farming practices.

Limited Infrastructure Is Major Challenge for Market

• One main challenge for the market growth is the lack of infrastructure and pipelines that can be incorporated with the natural gas grid, even in regions where biomethane is produced.
• Numerous countries still lack the necessary infrastructure to transport biomethane, forcing producers to rely on expensive and inefficient ways of transportation.
• Additionally, converting raw biogas into biomethane is essential for utilizing it in place of natural gas.
• To do this, contaminants, such as carbon dioxide, water vapor, and certain other gases, must be eliminated. However, there are not enough biogas upgrading facilities, which is impeding the expansion of the market.

Biomethane Market Analysis

Production Process Insights

• Anaerobic digestion and fermentation will hold the largest market share, of 80%, in 2024.
• Anaerobic digestion is a mature and well-established technology, which has been adopted by several countries, as it can convert organic matter into biomethane.
• Moreover, it provides an economically accessible approach to biomethane production, especially in agricultural and rural areas.
• This technique maximizes the availability of organic waste sources, such as animal manure, food waste, and agricultural residues.
• Additionally, this process offers a cost-efficient and simple method to generate biomethane, which helps in reducing greenhouse gas emissions and combating climate change.
• Thermal gasification is expected to grow at the highest CAGR, of 33%, in the forecast period.
• This is credited to its higher methane production potential since gasification creates syngas, which yields more biomethane when processed than other types.
• Moreover, the continuous advancements in gasification technology are helping in cost reduction and enhancing efficiency.

The production processes analyzed in this report are:

• Anaerobic Digestion & Fermentation (Largest Category)
• Thermal Gasification (Fastest-Growing Category)
• Others

Feedstock Insights

• Municipal waste will hold the largest market share, of 40%, in 2024, and it is expected to grow at the highest CAGR, of 30.0%, in the forecast period.
• The strict government regulations regarding waste disposal and management encourage municipalities to process waste into renewable energy sources, including biomethane, to meet environmental goals.
• Moreover, processing municipal waste into biomethane helps in reducing methane emissions from landfills, helping in environment conservation efforts.
• Additionally, this waste is a mix of different organic materials, which can generate a significant amount of biogas after processing.

The feedstocks analyzed in this report are:

• Energy Crops
• Agriculture Residue & Animal Manure
• Municipal Waste (Largest and Fastest-Growing Category)
• Others

End Use Insights

• Power generation will hold the largest market share, of 60%, in 2024 due to the implementation of sustainability goals.
• Nowadays, several countries are focusing on reducing greenhouse gas emissions; biomethane is used in high volumes for power generation, as it has a near-zero carbon footprint.
• Moreover, biomethane can be easily injected into the natural gas grid, which makes it a readily accessible renewable energy source, which helps entities achieve energy security.
• The transportation category is expected to grow at the highest CAGR, of 32.0%, in the forecast period.
• This is due to the rising usage of natural gas vehicles, for which biomethane is a better choice than conventionally produced CNG and LNG.
• Moreover, biomethane is cost-efficient compared to traditional fuels, which is another reason for its high-volume consumption in the transportation sector.

The end uses analyzed in this report are:

• Power Generation (Largest Category)
• Transportation (Fastest-Growing Category)
• Industrial
• Others

Regional Analysis

• Europe will hold the largest market share, of 60%, in 2024.
• Europe is at the top of biomethane technology, with continuous innovations in the anaerobic digestion and purification process.
• With government support, this region has enhanced its efficiency and reduced the costs of biomethane.
• For instance, as per the European Biogas Association (EBA), Europe is already producing over 3.5 bcm of biomethane. This represents a production increase rate of 20% from 2021.
• Moreover, the renewable energy directives in Europe are another reason for the growing demand for biomethane.
• These policies and regulations offer support and financial investment for biomethane projects.
• APAC is expected to grow at the highest CAGR, of 35.0%, in the forecast period.
• APAC countries are experiencing urbanization and rapid industrialization, which is leading to the high energy demand.
• Biomethane provides a renewable and sustainable alternative to traditional fossil fuels, fulfilling the increasing demand while adhering to environmental policies.
• This region is highly investing in biomethane infrastructure, enhancing the market capacity to distribute and handle biomethane efficiently.
• According to IEA, China actively developed new policies in 2022 with its 14th five-year plan for renewable energy development.
• Moreover, the countries in APAC have substantial agricultural industries that can produce organic waste, offering a significant feedstock supply for biomethane production.

The countries and regions analyzed in this report are:

North America

• U.S. (Larger Country Market)
• Canada (Faster-Growing Country Market)

Europe (Largest Regional Market)

• U.K. (Largest Country Market)
• Germany (Fastest-Growing Country Market)
• France
• Italy
• Spain
• Rest of Europe

Asia Pacific (APAC) (Fastest-Growing Regional Market)

• China (Largest Country Market)
• India (Fastest-Growing Country Market)
• Japan
• South Korea
• Australia
• Rest of APAC

Latin America (LATAM)

• Brazil (Largest and Fastest-Growing Country Market)
• Mexico
• Rest of LATAM

Middle East and Africa (MEA)

• Saudi Arabia (Largest Country Market)
• South Africa
• U.A.E. (Fastest-Growing Country Market)
• Rest of MEA

Biomethane Market Share

The biomethane market is highly fragmented with the presence of several players, such as L’AIR LI, WAGA ENERGY Group, and TotalEnergies SE. The technological developments in anaerobic digestion and purification, strategic partnerships, and the construction of pipeline injection and transportation infrastructure are among the market players’ primary focus areas. Players in the market are trying to maintain their positions by offering cost reductions, advancing the efficiency of production processes, and fulfilling regulatory requirements and the demand for clean energy.

Biomethane Market News

• In July 2024, L’AIR LIQUIDE S.A. announced an investment of EUR 100 million in a renewed partnership with Aurubis for a more-sustainable gas supply in Bulgaria and Germany.
• In February 2024, TotalEnergies SE joined forces with French sugar producer Cristal Union to produce biogas from sugar beet pulp.
• In October 2022, Chevron Corporation and California Bioenergy LLC expanded their partnership on dairy biomethane fuel projects.