PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 1933201
PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 1933201
The global biogas market is gaining strong momentum as countries worldwide focus on clean energy adoption, waste-to-energy solutions, and greenhouse gas emission reduction. Biogas is produced through the anaerobic digestion of organic materials such as agricultural waste, manure, municipal waste, food waste, and sewage sludge. It mainly consists of methane and carbon dioxide and is widely used for electricity generation, heating, cooking, and transportation fuel after upgrading into biomethane.
According to Fortune Business Insights, the global biogas market size was valued at USD 53.53 billion in 2025. The market is projected to grow from USD 56.24 billion in 2026 to USD 87.82 billion by 2034, exhibiting a CAGR of 5.73% during the forecast period. Europe dominated the global biogas market with a 48.66% market share in 2025, supported by strong policy frameworks and extensive biogas infrastructure.
Market Dynamics
Market Growth Drivers
One of the major factors driving the biogas market growth is the rising environmental concern related to greenhouse gas emissions. Governments across the globe are promoting renewable energy sources to reduce dependency on fossil fuels and meet climate targets. Biogas production captures methane emissions from organic waste that would otherwise be released into the atmosphere, significantly reducing environmental impact.
In March 2021, the Canadian government provided funding of approximately USD 116,800 to the Canadian Biogas Association to promote sustainable agricultural development. Additionally, biogas offers farmers an additional income stream while improving waste management efficiency in agricultural operations.
Another key growth driver is the increasing demand for upgraded biogas (biomethane). Biomethane has properties similar to natural gas and can be directly injected into natural gas grids or used as vehicle fuel. According to IRENA, biogas-based vehicle fuels can reduce greenhouse gas emissions by 60% to 80% compared to conventional fossil fuels. Germany currently has around 150 filling stations offering 100% biomethane, reflecting growing adoption in the transportation sector.
Impact of COVID-19
The COVID-19 pandemic temporarily disrupted the biogas market due to shutdowns in industrial activities, manpower shortages, and supply chain disruptions. Several bioenergy projects faced delays, and companies such as Strabag halted operations in March 2020. According to the U.S. Energy Information Administration, biomass-based electricity generation declined from 28.8 billion kWh in 2019 to 27.3 billion kWh in 2020, indicating the short-term impact of the pandemic.
Market Restraints
Despite its advantages, the biogas market faces challenges due to the high capital investment required for biogas plant setup. Large land requirements, expensive equipment, feedstock handling, and operational costs act as barriers, especially for small-scale investors. Additionally, storage, transportation, and distribution of biogas further increase overall project costs.
Biogas Market Trends
A major trend shaping the biogas market is the increasing acceptance of the Paris Climate Change Agreement by multiple countries. Governments are actively increasing renewable energy shares in their energy mix to meet climate commitments. Biogas, being a low-cost and scalable renewable energy source, is attracting strong public and private investments globally.
By feedstock, the market is segmented into organic residues & wastes and energy crops. The organic residues & wastes segment dominated the market with a 75.05% share in 2026, driven by the availability of agricultural waste, municipal waste, and food waste. According to the World Bioenergy Association, over 1.6 billion tonnes of food waste is generated globally each year, offering enormous energy-generation potential.
By application, electricity generation dominated the market, accounting for 50.96% market share in 2026, driven by increasing global electricity demand. Heating and combined heat & power (CHP) applications are also gaining traction due to renewable heating targets under the EU Renewable Energy Directive.
Europe held the largest biogas market share, supported by favorable regulations and extensive infrastructure. Germany leads the global market with over 10,000 biogas plants operating nationwide. The Germany biogas market is projected to reach USD 13.84 billion by 2026, while the UK market is expected to reach USD 3.67 billion by 2026.
The Asia Pacific region is anticipated to witness strong growth due to rising waste generation and stricter environmental regulations. The China biogas market is projected to reach USD 4.22 billion by 2026, while India is expected to reach USD 19.34 billion by 2026, driven by waste management initiatives and renewable energy policies.
North America also represents a significant market, with the U.S. market projected to reach USD 4.58 billion by 2026, supported by over 2,200 biogas and anaerobic digestion facilities across the country.
Competitive Landscape
The global biogas market is highly fragmented, with players focusing on expanding production capacity and strengthening regional presence. Key companies include Future Biogas Limited, Air Liquide, WELTEC BIOPOWER, EnviTec Biogas AG, Ameresco, and Quantum Green. Strategic expansions, new plant installations, and technological advancements remain central to competitive strategies.
Conclusion
The global biogas market is positioned for steady and sustainable growth over the forecast period, driven by increasing demand for renewable energy, rising environmental concerns, and strong government support for waste-to-energy technologies. Growing adoption of biogas across electricity generation, heating, and transportation applications highlights its role as a reliable alternative to conventional fossil fuels.
Supportive regulatory frameworks, climate change commitments under international agreements, and financial incentives are accelerating investments in biogas infrastructure, particularly across Europe and emerging economies in Asia Pacific. The increasing focus on biomethane production and its integration into natural gas grids is further enhancing the commercial viability of biogas projects worldwide.
Although high initial capital investment and operational challenges remain key restraints, continuous technological advancements and increasing private-public partnerships are expected to mitigate these challenges over time. With abundant availability of organic waste resources and growing emphasis on circular economy practices, the biogas market is expected to witness robust expansion through 2034, offering long-term opportunities for energy producers, technology providers, and policymakers alike.
Historic Period 2021-2024
Segmentation By Feedstock
By Application
By Region