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The global biomethane market size was valued at USD 5.76 billion in 2021. The market is projected to grow from USD 6.04 billion in 2022 to USD 8.41 billion by 2029, exhibiting a CAGR of 4.8% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with biomethane experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global biomethane market exhibited a growth of 14.2% in 2020 as compared to 2019.
Biomethane is a compressed form of biogas, also known as Renewable Natural Gas (RNG), and is a source of energy. It is produced from degrading organic substances such as agricultural waste, sewage sludge, domestic waste, and animal flesh. Furthermore, it is produced by anaerobic digestion and gasification methods. Since the raw material of RNG is organic, this gas is environment-friendly and has a diverse application range such as home cooking, heating, and power generation. It is also used as an alternative fuel in the automotive industry. It is ideal and environment-friendly as it reduces carbon dioxide emissions from the environment compared to other fuel options.
Pandemic Delayed Upcoming Biomethane Projects which Temporarily Impacted the Market Growth
The outbreak of the infectious disease known as the coronavirus disease, triggered by the newly discovered coronavirus, caused chaos and panic globally, causing the termination of all normal daily activities like going to work, gatherings, meetings, and commuting between countries, even stepping a foot outside the house. The biogas industry depends on forestry harvesting and residues. The sector faces a significant challenge due to the pandemic as regional or national movement restrictions have been forced in substantial countries. However, electricity and heat from biogas and bio-methane have continued to be generated.
One of the significant challenges that could affect the growth of the biogas market is the capital investment required to set up a production unit. Establishing the transmission and distribution lines for biogas also requires a considerable investment. The market is expected to face challenges due to the pandemic; however, the challenges are expected to be short-lived.
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Increasing Applications of Biomethane to Open New Doors in the Market
Anaerobic plants are switching from biogas to biomethane for power generation. Furthermore, various uses of this gas for different purposes create new opportunities. High exposure to air pollution released from petroleum fuel is dangerous for both the environment and humans. Europe has a huge opportunity as it is a key producer of renewable natural gas and other biofuels. The European Renewable Gas Registry is continuously working to implement a European administration system that will permit cross-border biogas trade.
Conversion of Waste into Renewable Energy and Rising Environmental Concerns to Propel the Market Growth
Rising demand for such gas due to rising environmental concerns is one of the key factors driving revenue growth in the global market. Additionally, the rising adoption of this gas for different purposes, such as power generation, heating, and use as an alternative fuel in the automotive industry, further boosts the market.
Moreover, this facility converts waste into energy and produces revenue. The eco-friendly nature of this gas further propels the market as it reduces greenhouse gas emissions and surges energy demand, further boosting the market.
Growing Demand for the Product in the Automotive Industry to Propel Market Growth
The demand for this gas is rapidly increasing worldwide owing to its emission-free nature and the growing generation of raw materials such as industrial waste, food waste, agricultural waste, and others. The upgraded biogas can be effectively used in transportation fuel and power generation.
A German Energy Agency named Deutsche Energie Agentur (DENA) stated that in 2020, filling station sales surpassed 1 TWh, which was around 733 GWh in 2019. Many CNG filling stations are switching to this gas, indicating the upcoming rise in this market.
As per the European Biogas Association (EBA), only 3.9 TWh of this gas is used to fuel natural gas in Europe. It is planned to increase the availability of renewable natural gas by 117TWh for vehicles by 2030, which will comprise around 13.2 million vehicles by 2030.
Enormous Financial Investments for Installing Facility and Highly Combustible Nature of the Gas to Hinder Market Growth
The major restricting factor for renewable natural gas production is the required capital. The industry must establish a production unit, waste acquisition, gas transmission, and distribution lines. Furthermore, many projects need to be carried out with government support, but the government also provides a certain amount of funding. Other factors that can hamper the market's growth are the low efficiency of the systems used in biogas production and the presence of impurities in the final product.
Organic Residue & Waste Segment Dominated due to Availability of a Diverse Range of Feedstock
Based on feedstock, the market is segmented into organic residue & wastes and energy crops.
Organic residue & waste is divided into biowaste, municipal waste, sewage waste, agriculture waste, and others. The organic residue & wastes segment holds the largest market share due to easy availability of this raw material globally. According to the sub-split of organic residue & wastes, agriculture waste and biowaste are the prime raw materials commonly available everywhere.
For instance, China generates an agricultural waste output of about 4.8 billion tons. India generates about 350 million tons, France generates about 60 million tons, Canada generates about 81 million tons, and the Brazilian agro-industrial chain generates about 291 million tons/year.
The energy crops segment is anticipated to grow with a significant market share. Energy crops have wide varieties, such as rice straw, maize, cassava tubers, corn waste, and potato. Crop residue management and curbing stubble burning is of global interest.
Anaerobic Digestion Segment to Dominate the Market Owing to its Cost-effectiveness
The anaerobic digestion segment is majorly dominating the market with 78.15% shares. Recently, anaerobic digestion units have been developed worldwide, especially in the United States, Europe, and China. The U.S. presents the highest total biogas production but originates from landfill at 75%. This country's 1,497 anaerobic plants treat sewage sludge, bio waste, and agricultural and industrial wastes. On the other hand, biogas production in Germany is mainly based on farming and industrial wastes.
The anaerobic digestion method is easy to apply and cost-effective, and a normal person can use this production method at a small scale to produce such nature friendly methane. Owing to this, the anaerobic digestion segment is significantly growing worldwide.
The gasification segment will likely grow with 21.85% of the market share. The gasification method is immature compared to the anaerobic digestion method, which needs high capital cost and low volume production. Additionally, maintain several parameters during production, such as temperature and pressure.
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Power Generation Segment to have Highest Rate Due to High Energy Demand and Consumption of Electricity
In terms of application, the global market is segmented into automotive, power generation, and others.
The power generation segment holds the largest market share owing to increased requirement for electric grid networks at residential locations for several uses such as water heating and cooking. Also, there has been a rise in the number of building construction projects in the residential sector, owing to snowballing urbanization, which has been the catalyst for the segment growth.
Furthermore, many anaerobic digesters are switching from power generation from biogas to upgraded biogas units for better efficiency. The rising demand for electricity consumption owing to the rising population further boosts the electricity generation segment.
The automotive segment is anticipated to grow owing to the rising demand for renewable natural gas for vehicle fuel. RNG is eco-friendly and reduces carbon dioxide emissions from the environment. Additionally, RNG is compatible with vehicle engines, further propelling this segment.
Europe Biomethane Market Size, 2021 (USD Billion)
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Geographically, the global market has been analyzed across five main regions, North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
Europe significantly dominates the biomethane market share in the global market. Growing environmental awareness, advancement of technologies, and steadily increasing demand for Renewable Natural Gas (RNG) for electricity generation applications are some of the region's market expansion factors.
Furthermore, Europe has noticeable RNG plants and many ongoing projects related to RNG. Germany, the U.K., the Netherlands, Denmark, Sweden, and France are major contributing countries. During the forthcoming years, the European biomethane market growth is anticipated due to rising investments in biogas upgrading technologies and rising support from regional governments. The presence of key manufacturers in the European market is generating income streams owing to supportive policies by governments for the production of such methane.
North America is likely to grow significantly throughout the forecast period. The demand for heating and electricity is increasing in the region. The region regularly faces winter for a long time in a year, increasing the demand for heating water and electricity generation. The U.S. holds a leading share in this region in this market.
Furthermore, the construction of new RNG plants in the U.S. continues to transform the world's electricity needs and inspire the industry to swell with possible GHG reduction and coal alternatives.
Asia Pacific region is the most profitable market for renewable natural gas. This region's huge agricultural waste ratio further drives market growth. The growing demand for renewable natural gas and import activities will boost the market. The key countries of these regions are China, India, Malaysia, Singapore, and Japan.
Latin America is anticipated to grow due to the rising demand for electricity generation and heating for residential and industrial applications, propelling the market in this region. Furthermore, government financial support for constructing new biogas and RNG plants further lifts the market in this region.
The Middle East & Africa shows significant growth in this market as rapid adoption of RNG production facilities and constructing new plants further boost the market in this region.
Key Market Players Concentrating on Enhancing Product Portfolio
The market's competitive landscape portrays a fragmented market with producers and service providers, such as EnviTec Biogas AG, ETW Energietechnik GmbH, and Future Biogas Limited, occupying a considerable share in the global market. These companies have been successful in acquiring new and long-term contracts from different countries in every region over the years. The market also includes other players such as WELTEC BIOPOWER GMBH, AB Holding SpA, RENERGON International AG, Gasrec, PlanET Biogas Global GmbH, and others who are increasing their customer reach and establishing a strong footprint in the market.
An Infographic Representation of Bio-methane Market
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The global biomethane market report provides a detailed analysis of the market and focuses on key aspects such as leading companies, feedstocks, and leading applications. Besides this, the report offers insights into this market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the market's growth in recent years.
Volume (GWh) and Value (USD Billion)
By Feedstock, Application, Production Method, and Region
By Production Method
Fortune Business Insights says that the global market size was USD 5.76 billion in 2021 and is projected to reach USD 8.41 billion by 2029.
In 2021, the market value stood at USD 5.76 billion.
Growing at a CAGR of 4.8%, the market will exhibit healthy growth in the forecast period (2022-2029).
By application, the power generation segment is the leading segment in the market
Conversion of waste into renewable energy and rising environmental concerns propel the market growth
WELTEC BIOPOWER GMBH, AB Holding SpA, RENERGON International AG, Gasrec, and PlanET Biogas Global GmbH are among the leading players in the global market.
Europe dominated the market in 2021
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