Market overview

Biomethane is methane made by upgrading biogas from anaerobic digestion of manure, crop residues, food waste, sewage and landfill gas, removing CO2, H2S and moisture to natural-gas quality. It is injected into gas grids, sold as compressed biogas (CBG) or bio-CNG and LNG for vehicles, and used for heat and power. Supply is driven by policy: India's SATAT programme and CBG blending obligation, the EU's REPowerEU target and the US Renewable Fuel Standard and state low-carbon fuel credits.

The question this report answers
How fast can biogas upgrading capacity grow in India, Europe and the US to meet blending mandates and targets, and who captures the value between feedstock, upgrading and offtake?

1. Demand: who uses biomethane and where it is growing

Power and CHP is the largest use at about 51% (Fortune Business Insights), and Europe is the largest region at about 61% (Fortune Business Insights); transport fuel under the US RFS and India's CBG mandate grows fastest.

Demand by application (share of 2025 consumption)
– Power generation and CHP: 51% (Fortune Business Insights)
– Transport fuel (bio-CNG, CBG, bio-LNG): 24% (Market Krystal estimate)
– Industrial heat and feedstock via the grid: 13% (Market Krystal estimate)
– Residential and commercial heating via the grid: 12% (Market Krystal estimate)
Power and regional shares follow Fortune Business Insights; transport, industry and building shares are Market Krystal estimates set from EBA's grid-connection data (over 85% of plants grid-connected) and the US and Indian focus on vehicle fuel.

Demand by region (share of 2025 consumption)
– Europe: 61% (Fortune Business Insights)
– North America: 20% (Fortune Business Insights)
– Asia Pacific: 10% (Fortune Business Insights)
– Latin America: 6% (Fortune Business Insights)
– Middle East and Africa: 3% (Fortune Business Insights)

Where demand grows fastest to 2035
– Compressed biogas in India's CNG and PNG networks: The blending obligation rises to 5% of CNG and PNG use from FY2028-29 (Lok Sabha), and ICRA expects CBG volumes to grow about 62% a year over FY2024-FY2029 (ICRA)
– Grid injection in the EU: Grid injection rose 12% to 43.2 TWh in gas year 2024-25 (ENTSOG), against a REPowerEU goal of 35 bcm by 2030 (ENTSOG)
– Transport fuel in the US: Cellulosic RIN generation, mostly RNG, reached 1,013 mn in 2024 against a 1,090 mn mandate, and the 2025 mandate rises to 1,380 mn (AFDC, US DOE) (US DOE Alternative Fuels Data Center)

2. Supply: who makes biomethane and how much

Europe has about 1,678 upgrading plants led by France, Germany, Italy, Denmark and the Netherlands (EBA); the US had 237 landfill and farm RNG projects in 2023 (EPA); leading companies include Shell (Nature Energy), bp (Archaea), OPAL Fuels, Clean Energy Fuels, Adani TotalEnergies and Reliance. Europe produced 5.2 bcm of biomethane in 2024 and had 7 bcm/yr of upgrading capacity in early 2025 (EBA); the US had 102 landfill and 135 farm RNG projects operating in 2023 (EPA LMOP); India had 114 CBG plants commissioned and 1,103 active letters of intent in Nov 2025 (SATAT via Renewable Watch).

Main producers and capacity
– Shell (Nature Energy) (Denmark / Europe): Described by Shell as Europe's largest producer of RNG from biomass; acquisition completed Feb 2023 (Shell)
– bp (Archaea Energy) (United States): About 11 mn MMBtu of RNG produced in 2023 from landfills and farms; bp calls it America's largest RNG producer (bp)
– OPAL Fuels (United States): 12 RNG facilities with 9.1 mn MMBtu/yr design capacity; 4.9 mn MMBtu produced in 2025
– Clean Energy Fuels (United States): 237.4 mn gallons of RNG sold in 2025; South Fork Dairy, Texas (about 2.6 mn gal/yr) completed Q4 2025
– Adani TotalEnergies Biomass (India): Barsana CBG plant, Phase 1 of 225 t/day commissioned FY2023-24; over 730 t CBG supplied to GAIL in FY2024-25 (Adani Total Gas)
– Reliance Industries (India): Named among the main CBG investors under SATAT (ICRA)
– IOCL, BPCL, GAIL and ONGC (India): Offtakers and developers of CBG plants under SATAT and the CBG-CGD scheme (ICRA)

Production by region (share of 2024 output)
– Europe: 61% (Fortune Business Insights (value share))
– North America: 20% (Fortune Business Insights (value share))
– Asia Pacific: 10% (Fortune Business Insights (value share))
– Latin America: 6% (Fortune Business Insights (value share))
– Middle East and Africa: 3% (Fortune Business Insights (value share))

Trade and supply-demand balance
Biomethane is mostly used where it is made, but trade grows through grid certificates in Europe and book-and-claim RNG moved through US pipelines to California and other credit markets; India's output of about 31,400 t in 2024-25 is far below its blending needs (Renewable Watch).

3. Value chain: from feedstock to end market

Agricultural residues, manure and energy crops + Crop residues such as paddy straw and press mud + Municipal organic waste and sewage sludge → biomethane → Power generation and CHP, Transport fuel (bio-CNG, CBG, bio-LNG), Industrial heat and feedstock via the grid

Raw materials
– Agricultural residues, manure and energy crops: Main European feedstock, shifting toward residues with the highest GHG savings (EBA) (EBA)
– Crop residues such as paddy straw and press mud: Core Indian feedstock; aggregation cost led the ministry to revise machinery subsidies in Jul 2025 (Renewable Watch) (Renewable Watch)
– Municipal organic waste and sewage sludge: Gate-fee feedstock; Adani won 500 t/day and 250 t/day municipal waste projects in Ahmedabad and Rajkot (Adani Total Gas) (Adani Total Gas)
– Landfill gas: 102 of 237 US RNG projects in 2023 were landfill-based (EPA LMOP), and landfills are the base of bp Archaea's fleet (bp) (EPA LMOP)

Production route
Anaerobic digestion produces raw biogas, a mix of methane and CO2, which is cleaned of H2S and moisture and upgraded by membrane separation, water scrubbing, pressure-swing adsorption or amine scrubbing to grid or vehicle-fuel quality; thermal gasification with methanation is an emerging route.

Downstream
Upgraded gas is injected into grids, compressed into cascades as CBG or bio-CNG for fuel stations, or liquefied as bio-LNG, and sold with certificates, RINs or blending credits to utilities, CGD companies and fleets.

Price, cost and margin
Value depends on policy credits more than gas prices; GAIL buys CBG at 85% of the average CNG retail price (Renewable Watch). Revenue depends on policy value. GAIL procures CBG at 85% of the average CNG retail price against a Rs 1,478/MMBtu reference (Renewable Watch); in the US, OPAL realised USD 2.40 per D3 RIN and USD 76.71 per LCFS credit in Q4 2025 (OPAL Fuels). Margin sits with producers that control low-cost feedstock and credit value, while upgrading equipment suppliers earn on capex.

Where the chain is tightest
Feedstock aggregation and offtake contracts are the tightest step, shown by India's 114 commissioned plants against 1,103 letters of intent (Renewable Watch).

Who sits where in the chain
– Digestion and upgrading: Shell (Nature Energy), Adani TotalEnergies Biomass
– Landfill gas upgrading: bp (Archaea Energy)
– Production and fuelling: OPAL Fuels
– Fuel distribution: Clean Energy Fuels
– Production: Reliance Industries
– Offtake and pipelines: GAIL
– Offtake and retail: Indian Oil, BPCL, ONGC
– Upgrading technology: Air Liquide, Waga Energy
– Production and distribution: Gasum
– Plant engineering: EnviTec Biogas

4. Market size: what demand, supply and price add up to

Market Krystal preliminary estimate (2025)
Two publishers put 2025 at USD 6.95-9.30 bn (Fortune Business Insights, Towards Chemical and Materials); MarketsandMarkets-based releases publish USD 10.3 bn for 2023 and USD 16.5 bn for 2025 with 28% growth. European biomethane output of 5.2 bcm in 2024 (EBA), about 55 TWh, valued at an indicative EUR 70-100/MWh including green certificate value gives roughly USD 4.2-6 bn; with Europe at 45-61% of the global market (Towards Chemical and Materials; Fortune Business Insights) this implies USD 8-11 bn. The per-MWh value is a Market Krystal assumption, so the check is partial. On this basis we use USD 8-11 bn. Confidence grade B: published estimates exist; the volume or price cross-check is partial.

How published estimates compare
Publishers range from USD 6.95 bn to USD 16.5 bn for 2025 because some include raw biogas, power and equipment while others value only upgraded gas. Market Krystal values upgraded methane from European volumes and scales by published regional shares.

Key figures at a glance (third-party, cited)
– Europe produced 22 bcm of biogas and biomethane in 2024, including 5.2 bcm of biomethane (EBA)
– Renewable gas injected into EU grids rose 12% to 43.2 TWh in gas year 2024-25 (ENTSOG)
– US cellulosic RIN generation was 1,013 mn in 2024 against a 1,090 mn mandate (AFDC, US DOE), and over 95% of the cellulosic requirement has been met with renewable CNG/LNG (EPA) (US EPA / US DOE)
– The US had 102 landfill and 135 agricultural RNG projects operating in 2023 (EPA LMOP) (US EPA)
– India's CBG blending obligation is 1% in FY2025-26, 3% in FY2026-27, 4% in FY2027-28 and 5% from FY2028-29 (Lok Sabha) (Ministry of Petroleum and Natural Gas)
– Biomethane generated 20% of California LCFS credits in Q1 2025 (IETA)

5. Outlook to 2035 and scenarios to 2047

Regulation and substitution
India's CBG blending obligation rises from 1% in FY26 to 5% from FY29 (Lok Sabha); the EU targets 35 bcm by 2030 (ENTSOG); the US RFS cellulosic mandate is met over 95% by RNG (EPA), while California's amended LCFS phases out biomethane credits for combustion engines (IETA).

Recent developments among key stakeholders
– Mar 2026: OPAL Fuels reported 2025 RNG output of 4.9 mn MMBtu from 12 facilities with 9.1 mn MMBtu/yr design capacity, and guided 5.4-5.8 mn MMBtu for 2026 (OPAL Fuels)
– Feb 2026: Clean Energy Fuels sold 237.4 mn gallons of RNG in 2025 and completed the South Fork Dairy RNG project in Texas (Clean Energy Fuels)
– Dec 2025: The Ministry of Petroleum and Natural Gas reported more than 130 CBG plants commissioned in India by 1 Nov 2025 in its Year End Review (Ministry of Petroleum and Natural Gas (via Mercom/iamrenew))
– Dec 2025: The European Biogas Association reported 2024 biomethane output of 5.2 bcm and 1,620 plants at the end of 2024 (European Biogas Association)
– Jul 2025: EPA cut the 2024 cellulosic RFS volume from 1.09 bn to 1.01 bn RINs to match actual generation, which is mostly RNG (US EPA (Federal Register))
– May 2025: bp's Archaea Energy and Rumpke brought two modular landfill RNG plants online at Wellston and Waverly, Ohio (RNG Coalition)

What this means for the market
Indian CGD companies and oil marketers must source rising CBG volumes from FY27, so offtake contracts and feedstock logistics now matter more than plant count. European gas suppliers and upgrading vendors face a target far above current output, which favours large plants and gasification. US producers such as bp Archaea, OPAL and Clean Energy depend on D3 RIN and LCFS credit prices, and California's tighter rules on biomethane credits push them toward RFS and other state markets.

Strategic scenarios to 2047
– Base: Europe reaches about 7-10 bcm in the early 2030s, India meets most of its 5% obligation by the early 2030s and US growth follows RFS volumes.
– Constrained supply: Feedstock aggregation, permits and low credit prices cap growth well below REPowerEU and SATAT goals.
– Technology transition: Gasification, e-methane from biogenic CO2 and cheap membrane upgrading at small farms raise output per site.
The swing factor for biomethane is Policy credit value (RINs, LCFS, CBO, EU certificates). Signposts: D3 RIN prices, LCFS credit prices, India CBO compliance, SATAT commissioning, EBA and ENTSOG annual data, EU gas market package rules, gasification plant start-ups.

What this report delivers
Annual volume (tonnes) and value (USD) for 2026-2035, segmented by application: Power and CHP, Transport fuel (bio-CNG, CBG, bio-LNG), Industrial heat, Residential and commercial heating; end use: Gas grids and utilities, City gas distribution, Fleets and heavy trucks, Industry, Agriculture (digestate fertiliser); region: Europe, North America, India, China and rest of Asia Pacific, Latin America, Middle East and Africa. Each segment is backed by a producer capacity map, trade data and the Market Krystal estimate log, with scenarios to 2047 and strategic recommendations.