Biogas Market Size, Share, Growth, Report 2025 to 2034

Biogas Market Size and Growth 2025 to 2034

The global biogas market size was valued at USD 68.85 billion in 2024 and is expected to be worth around USD 103.77 billion by 2034, growing at a compound annual growth rate (CAGR) of 4.18% over the forecast period 2024 to 2033.

The biogas market is expected to grow due to increasing product demand from various application segments including heat, power, upgraded biogas, vehicle fuel and cooking gas. In addition, a change in emphasis towards utilizing renewable energy, particularly in the electricity sector, has greatly boosted the need for biogas in energy uses. Also, the growing necessity to lessen reliance on fossil fuels is generating profitable prospects for biogas in automotive fuel uses.

Biogas is a renewable energy source produced by anaerobic digestion of organic matter such as agricultural residues, municipal waste or wastewater. In this process, organic matter is broken down by microorganisms in the absence of oxygen to produce biogas, which mainly consists of methane (CH2) and carbon dioxide (CO2). Biogas offers several benefits such as eco-friendly recycling of industrial and domestic organic waste, protection of groundwater and increasing yield in fields.

Report Highlights

• The Europe is leading the market and accounted revenue share of 41.72% in 2024.
• The Asia-Pacific region has captured revenue share of 37.41% in 2024.
• By source, the municipal segment has held revenue share of 45.20% in 2024.
• By application, the electricity segment accounted for a revenue share of 31% in 2024.

Biogas Market Growth Factors

• Biogas Technology Promotes a Circular Economy: The technology for producing biogas is quite cheap. It is easy to set up and requires little investment when used on a small scale. Small biogas plants can be used directly at home and utilize kitchen waste and animal manure. A household system pays for itself after a while and the materials used to produce it are free. The gas produced can be used directly for cooking and electricity generation. This makes the cost of biogas production relatively low. Farms can use biogas plants and the waste products of their livestock on a daily basis. The waste products of a cow can provide enough energy to power a light bulb for an entire day. In large plants, biogas can also be compressed to reach the quality of natural gas and used to power cars. Building such plants requires relatively low capital investment and creates green jobs. In India, for instance, 10 million employment opportunities have been generated, primarily in rural regions, within factories and in the collection of organic waste.
• Flexibility and Energy Storage: Biogas may be utilized in numerous ways, such as producing electricity and heat, and creating biomethane for use as fuel. Biogas plants can serve as a flexible energy source that helps stabilize the power grid, especially during weather-related fluctuations in renewable energy sources such as solar and wind power.
• Rising Environmental Concerns: Rising carbon and greenhouse gas emissions pose a significant issue for nations around the globe. To tackle this, governments from diverse countries have enacted a variety of initiatives, including increasing the share of renewable energy in the energy mix, decarbonizing the transportation sector, and producing biogas. For example, in March 2021, the Canadian government announced approximately $116,800 in funding for the Canadian Biogas Association (CBA) to accelerate sustainable agricultural development. The production of biogas helps to reduce greenhouse gas emissions by capturing methane that would otherwise be released into the atmosphere from organic waste. Furthermore, biogas production improves the use of agricultural by-products and livestock manure as feedstocks, providing farmers with an extra source of income while aiding in the waste management of farms.

Biogas Market Trends

• Enhancement and Application of Biogas: Biogas upgrading technologies play a crucial role in the efficient utilization of biogas and its integration into existing energy systems. Upgrading processes remove impurities such as carbon dioxide, moisture and trace contaminants from raw biogas, producing high-purity methane, known as biomethane. Biomethane's uses and market potential can be increased by using it as fuel or by injecting it into the natural gas system.
• Growing interest in biomethane: Both existing and new anaerobic digestion plants are shifting from generating electricity from biogas to upgrading the biogas into biomethane. The high value of this renewable gas has been recognized as biomethane can be used for the same end-use applications as natural gas. In 2018, three more European countries (Belgium, Estonia and Ireland) connected their first biomethane plant to their national gas grid, bringing the total number of European biomethane producing countries to 18. The European Renewable Gas Registry (ERGaR) is working hard to implement a European management system that will enable cross-border trade in biomethane and is expected to boost the biomethane sector even further.
• Feedstock Diversification: Traditionally, biogas production has relied heavily on agricultural waste and animal manure, which still account for 65% of EU resources. However, advances in pre-treatment techniques and inhibition mitigation technologies have enabled the use of a wider range of feedstocks, including food waste, faecal sludge, energy crops and organic industrial waste. Diversifying feedstock sources not only expands the availability of biomass for biogas production, but also addresses waste management challenges and strengthens the circular economy. Research and development in the field of secondary waste continues, with a particular focus on lignocellulosic biomass (straws, pulp, stems, husks, etc.), which has significant energy potential but has more complex cellular structures that need to be separated.

Report Scope

Biogas Market Dynamics

Drivers

Increasing Need for Emission Reduction

• The greenhouse gas emissions from various energy intensive industries including transportation, building, power, agriculture and others have increased over the last decade, leading to a change in the climate pattern. These factors also pose a threat to global temperatures and disrupt human and ecological activities. Switching to biogas as a fuel for vehicles can reduce greenhouse gas emissions in the transportation sector by 60-80% as compared to fossil fuels like petrol and diesel. Most countries have set emission reduction targets in response to climate change and growing environmental concerns. Increasing preference for green energy that minimizes emissions is expected to increase the demand for biogas.

Increasing Demand from Various Application Areas

• Factors such as reduced household air pollution and related diseases, low annual cost and locally available feedstocks such as agricultural residues or animal or human waste are increasing the demand for biogas for cooking gas applications. Biogas is also becoming popular in power generation. Electricity generated by biogas is used for barns or homes and can be sold to the grid, helping to reduce dependence on utilities. The increasing use of biogas in applications such as heat, electricity and vehicle fuel is expected to further boost market growth.

Restraints

Legal Obstacles and Permitting Processes

• Biogas facility operations require rigorous permitting methods and compliance with environmental regulations. The design and implementation of the plant could be complicated and prolonged because of regulatory limitations and administrative challenges. Such uncertainties may lead to decreased willingness from investors to finance biogas plants and impede their widespread adoption.

High Initial Investments Associated with Biogas Production

• Constructing a biogas plant costs land, materials, equipment and labour, and the process of sourcing and storing raw materials is costly and time-consuming. Regulations and financial support are required for sorting, collecting, processing, delivering and distributing the feedstock, building and operating the plant, and selling and distributing biogas. The plant's output must be sufficient and consistent to cover installation and operating costs. In addition, the optimal temperature required for bacteria to ferment the waste is around 37 °C. In a cold climate, for example below 20 °C, biodigesters require thermal energy to maintain a constant biogas supply, which can further increase costs.

Opportunities

Cutting-edge Anaerobic Digestion Systems

• Advanced technology for anaerobic digestion is among the major advancements in the generation of biogas. These advanced technologies accelerate the decomposition of organic matter, increasing the production of biogas and improving process efficiency. Examples of sophisticated technology include multi-stage anaerobic digestion, nutrient recovery, and SMASH (Sequential Multiple Anaerobic Stages with Hydrogen).

Market Incentives and Policy Assistance

• Governments around the world recognize the importance of biogas as a renewable energy source and implement supportive policy measures and market incentives to encourage its development. These include feed-in tariffs, renewable energy certificates, tax incentives and grants. Such measures stimulate investment in biogas infrastructure, promote research and development and create a favourable market environment for the industry to succeed. The UK government's recent extension of the green gas support scheme until March 2028 is one example.

Challenges

Infrastructure Challenges

• Biogas plants require advanced technology and specific skills to be established and run effectively. To ensure efficient biogas generation, the facilities need to be continuously monitored and maintained. Digesters and processing facilities are examples of critical infrastructure that may need significant investment costs, deterring many potential investors.

Competition among Renewable Sources

• Alternative renewable energy sources like solar and wind compete with biogas in the energy market. The focus of several political and economic campaigns to advance renewable energy has been on these energy sources, which have become increasingly significant in recent years. It's possible that the competition from these established, substantially subsidized energy sources may make biogas a less appealing investment option.

Biogas Market Segmental Analysis

The biogas market is segmented into source, application and region. Based on source, the market is classified into municipal, industrial, and agricultural. Based on application, the market is classified into electricity, heating, vehicle fuel, cooking gas, upgraded gas.

Source Analysis

Municipal: The municipal segment has dominated the market in 2024. For municipal sources, solid waste such as food waste, glass, garden waste, non-recyclable paper, wood waste, rags, and sludge from sewage are widely used as raw materials for biogas production. Increasing use of municipal solid waste in biogas production to reduce landfill and greenhouse gas emissions is expected to support the market demand during the forecast period.

Agricultural: Agriculture is one of the major sources of biogas production. Waste materials such as manure, agricultural waste, and food and slaughterhouse waste from dairy, poultry and pig farming and farms are used as feedstocks for biogas production. These feedstocks are stored in clamps or hoppers and ensiled before being fed into the digester to be converted into sustainable energy for various applications including electricity, heat, automotive fuel and feed gas.

Biogas Market Revenue Share, By Source, 2024 (%)

Industrial: The need for wastewater treatment in the industrial sector is expected to increase along with the growing interest in developing practical methods to produce bioproducts and biofuel from industrial food waste. In addition, food and beverage industries are now focusing on proper food waste management to achieve zero waste. Companies such as Nestlé S.A., PepsiCo, Inc. and Unilever plc have started converting food waste into biogas to generate electricity for manufacturing units. These trends and supportive government policies are likely to drive the market growth in the coming years.

Application Analysis

Electricity: The electricity segment has dominated the market in 2024. Biogas has gained importance as a sustainable and environmentally friendly source of electricity generation. The use of biogas for electricity generation is in line with global efforts to transition to cleaner and more sustainable energy sources, helps reduce greenhouse gas emissions and promotes environmental sustainability. The use of biogas for electricity generation has increased due to increased focus on the use of renewable energy, particularly in the power sector. In addition, the shift from coal-fired power plants to gas-based power plants taking place in various countries due to rising carbon emissions is expected to boost the demand for biogas for electricity generation during the forecast period.

Heating: Biogas is widely used for heating purposes in the industrial and domestic sectors. Biogas production through the anaerobic decomposition process of organic material is used to generate heat through a gas engine using combined heat and power (CHP) technology. Unlike traditional on-site power generators and boilers, heat is recovered during the combustion process of organic material using heat exchangers built into the cooling and exhaust systems of cogeneration engines. This helps reduce energy consumption as well as pollution.

Vehicle Fuel: Growing awareness of greenhouse gas emissions in the transportation sector as well as various stringent government regulations are driving the demand for biogas as a vehicle fuel. The transportation sector accounts for 30% of global energy consumption and switching to biogas as an alternative vehicle fuel can help reduce greenhouse gas emissions in the transportation sector by 60-80% compared to fossil fuels such as diesel and gasoline. Therefore, countries such as Sweden, Germany, the UK, Switzerland and the US are encouraging the use of biogas-powered trucks, cars and buses through a combination of investment grants, tax exemptions and incentives for feeding biogas into the natural gas grid.

Cooking: Biogas burns cleanly and efficiently, making it a highly effective fuel for cooking. It can be used in a wide range of cooking appliances, including stoves, ovens and boilers, and is easily adapted to achieve different heat levels. Biogas is generally less expensive than other cooking fuels, especially in areas where it can be produced locally. It can also be produced on a small scale, making it accessible to households and small businesses that may not have access to other energy sources. Biogas is an excellent alternative to traditional cooking fuels, providing a clean, efficient and cost-effective way to cook and heat food.

Upgraded Biogas: Upgraded biogas refers to the process of converting biogas into biomethane, which is achieved by removing hydrogen sulphide, water, carbon dioxide and impurities from the original biogas. This upgraded form of biogas, known as biomethane, shows promise as a cleaner and more refined biofuel, making it suitable for various applications, including fuelling vehicles.

Biogas Market Regional Analysis

The biogas market is segmented into various regions, including North America, Europe, Asia-Pacific, and LAMEA. Here is a brief overview of each region:

What factors contribute to Europe's leadership in the biogas market?

The Europe biogas market size was estimated at USD 28.72 billion in 2024 and is projected to surpass around USD 43.29 billion by 2034. Numerous countries such as Austria, Germany, and Denmark have a robust legal structure for renewable energy sources. Due to technological advancements and increasing spending in the region's refining industry, the biogas market in Europe is growing. Companies across Europe are investing significant amounts in research and development of biogas production from existing sources and are planning to increase the share of feedstock in the next few years, which will support the market growth of biogas in the region. The government and various European organizations are initiating projects to actively promote and support the use of biogas. In addition, the high depletion rate of fossil fuels in the region provides numerous growth prospects for the global market. The European Union has set a goal to use more renewable energy than fossil fuels. The government's focus on reducing carbon emissions also provides growth opportunities for the European market.

Why is Asia-Pacific hit high growth in the biogas market?

The Asia-Pacific biogas market size was accounted for USD 25.76 billion in 2024 and is anticipated to reach around USD 38.82 billion by 2034. The Asia Pacific biogas market is still in the early stages of its development. The main reasons for the region's high growth are the increased demand for biogas and growing public and private investments. The solid waste generated annually worldwide is over 2 billion tons, and about 40% of the solid waste comes from Pacific and Southeast Asian countries. Therefore, the region can produce biogas and solve the problems related to waste management and climate change. In addition, the Asia Pacific market is growing due to the region's high energy consumption and strict environmental laws. Increasing investments by the public and private sectors in China in the production of biogas are driving the development of the market.

North America Biogas Market Trends

The North America biogas market size was estimated at USD 8.12 billion in 2024 and is expected to reach around USD 12.24 billion by 2034. The increasing demand for the product in applications such as cooking gas, electricity, vehicle fuel, heat, and others is expected to have a positive impact on the industry growth during the forecast period. The adoption and innovation of new technologies to promote the production of feedstocks for generating biogas in the U.S. is expected to boost the overall growth of the global market in the region. The major factors supporting the growth include high demand for green fuels, stringent environmental regulations, and increased investments in refinery development. Producers of biogas are pursuing strategies such as mergers and acquisitions to increase their market share and regional production capacity.

LAMEA Biogas Market Trends

The LAMEA biogas market was valued at USD 6.24 billion in 2024 and is predicted to hit around USD 9.41 billion by 2034. The demand for biogas in the Latin America region is mainly driven by Brazil, which has the largest share of commodity production among Latin American countries. The considerable growth of the regional market is leading to increased government initiatives towards energy security and energy independence. Moreover, the high dependence on exhaustible fossil fuels has forced the various governments of the region to look for alternatives. The increasing environmental concerns are expected to boost the demand for biogas in the Middle East and Africa. Favourable regulatory policies and increasing government investments will further drive the adoption of biogas across the region.

Biogas Market Top Companies

• Engie SA
• Spectrum Renewable Energy Pvt. Ltd.
• Air Liquide
• EnviTec Biogas AG
• Atmos BioEnergy
• AAT Biogas Technology
• Hitachi Zosen Corporation
• Gasum Oy
• Ameresco
• Biogas Engineering India Pvt Ltd.
• Schmack Biogas GmbH
• Future Biogas Limited
• Weltec Biopower GmbH
• Green Elephant India Private Limited
• Cyy Bio Power Co. Ltd.
• Nikkiso Clean Energy & Industrial Gases Group
• Aqua Society Co. Ltd.
• Biogass Renewables Pty Ltd.
• Mingshuo Environment Technology Group Co. Ltd.
• Aquatec Maxcon
• K-BioPower Co. Ltd.
• New Energy Technology Co. Ltd.
• Hubei Kexin Environmental Energy Co. Ltd.
• Zorg Biogas GmbH
• Asia Biogas
• Itaipu Biogas Plant
• Beijing Shenwu Environment & Energy Technology
• PlanET Biogas Group GmbH
• TotalEnergies SE
• Biogas Systems Nord LLC

The global biogas industry is extremely fragmented due to the numerous regional and international players. Numerous players across the world are gradually contributing organic and inorganic developments to strengthen their market position. Most of the companies are focusing on enhancing their production capacities by introducing new plants or expanding existing ones. 
Anaergia secured a contract in April 2023 to supply its technologies for PepsiCo's new 'Simba Chips' facility in South Africa. They will use high solids anaerobic digestion to convert food processing waste into renewable energy, generating 800 kW annually. The aim is to reduce Scope 1 emissions, manage waste sustainably and generate carbon-free energy. Hence, the company will help PepsiCo achieve its net zero emission targets and also demonstrate its expertise in the market. In December 2021, BoxLNG Pvt. Ltd., a developer of clean bioenergy projects, signed a technology collaboration and investment agreement with Netherlands-based HoSt Holding B.V (HoSt) to build compressed biogas plants in India. Compressed biogas (CBG), produced by anaerobic decomposition of agricultural waste, press sludge from sugarcane and municipal waste, can be used as fuel for cars. In March 2021, Eni SpA (BIT: ENI) agreed to buy an Italian biogas company from FRI-EL Greenpower, a holding company of the Gostner family, through its circular economy subsidiary “Ecofuel”. However, this acquisition still needs to be approved by the relevant antitrust authorities. In May 2020, Weltec Biopower built a plant in Veria, Greece. The main investor in the project is the largest slaughterhouse for cows and pigs in Greece.

Recent Developments

• In November 2024, the Government of Andhra Pradesh and Reliance Group entered into an agreement valued at Rs 65,000 crore to establish 500 compressed biogas (CBG) facilities in the state within the upcoming three years.
• In May 2024, ONGC and EverEnviro Resource Management, a compressed biogas (RNG) developer in India, formed a 50:50 joint venture (JV) to set up 10 compressed biogas (CBG) plants across India. It is projected that these facilities would increase domestic production of renewable energy and reduce India's dependency on imported gas.
• MAKEEN Energy and BB Bioenergi entered into a contract in June 2023 to set up a biogas liquefaction facility in northern Denmark. This facility will enhance the existing biogas plant owned by BB Bioenergi. MAKEEN Energy will use its liquefaction technology to convert biogas into a liquid form, which will then be further used in the industrial and transportation sectors. The companies have significantly contributed to and supported the industry's sustainability goals through this partnership and will strengthen their position across the region.

Market Segmentation

By Source

• Municipal
  
  • Landfill
  • Wastewater
• Industrial
  
  • Food Scrap
  • Wastewater
• Agricultural
  
  • Dairy
  • Poultry
  • Swine Farm
  • Agricultural Residue

By Application 

• Electricity
• Heating
• Vehicle Fuel
• Cooking Gas
• Upgraded Gas

By Region

• North America
• Europe
• APAC
• LAMEA