European countries are increasingly turning away from state-funded production support for biomethane towards demand-side compliance obligations, according to new S&P Global research.
It cites the Netherlands as an important player in the European gas market and one that is “pivoting towards compliance” with 92 plants installed as of Q1 and 2.70 TWh injected into its grid in 2024. It plans to implement green gas units, targeting industry and other sectors, by 2027.
Yet the EU’s biomethane market growth remains hindered by a fractured policy picture with counterparties needing to navigate shifting requirements for grid connection and injection, cost allocation, guarantees of origin, proof of sustainability and certification systems in a rapidly evolving market.
Anna Venturini, Policy Director at the European Biogas Association (EBA), told Platts, part of S&P Global Energy, that there is still “considerable fragmentation between national markets”.
“A more harmonised approach, including interoperable certification and registry systems and a fully operational union database, would be important for developing a genuine European market for renewable gases,” she added.
Market players and EU members states are divided between two contrasting models, said Alexia Vieira, Principal Biofuels Analyst at S&P Global Energy CERA. On the one hand, a producer-focused, subsidy-driven circular system, and on the other, a buyer-focused, market-driven model.
“The EU regulatory framework allows both to coexist, which creates tensions, uneven implementation, and increased risk for developers and offtakers,” she said.
“Policy is shifting away from stable, production-based subsidies toward consumption-based obligations. This shifts the revenue risk from governments to producers, making project revenue dependent on volatile market conditions and increasing financing uncertainty.”
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The European Commission officially rolled out its in June, a matchmaking platform designed to connect biomethane producers, buyers, and investors across the EU under the EU Energy and Raw Materials Platform.
France is Europe’s largest producer, with 11.6 terawatt-hours injected into its gas grid in 2024, according to the EBA. The country has more than 829 biomethane plants as of Q1, with generous government subsidies having incentivised rapid production uptake in previous years. Germany is second, with 282 installed plants as of Q1, and it injected 10.94 TWh into its grid in 2024.
Italy is among the nations growing rapidly, fuelled by and plant development.
Europe’s biomethane sector added more than 1 billion cubic metres (bcm) of annual production capacity in a year and , up 17% on 2025, according to the EBA.
