Key findings

A detailed, bottom-up study of the worldwide availability of sustainable feedstocks for biogas and biomethane, conducted for this report, shows that the technical potential to produce these gases is huge and largely untapped. These feedstocks include crop residues, animal manure, municipal solid waste, wastewater and – for direct production of biomethane via gasification – forestry residues. This assessment considers only those feedstocks that do not compete with food for agricultural land. Biogas and biomethane production in 2018 was around 35 million tonnes of oil equivalent (Mtoe), only a fraction of the estimated overall potential. Full utilisation of the sustainable potential could cover some 20% of today’s worldwide gas demand.

Biogas and biomethane production in 2018 against the sustainable potential today

Biomethane potential 730 Mtoe

Biogas potential 570 Mtoe

Actual production

35 Mtoe

Every part of the world has significant scope to produce biogas and/or biomethane, and the availability of sustainable feedstocks for these purposes is set to grow by 40% over the period to 2040. The largest opportunities lie across the Asia Pacific region, where natural gas consumption and imports have been growing rapidly in recent years, and there are also significant possibilities across North and South America, Europe, and Africa. The overall potential is set to grow rapidly over the next two decades, based on increased availability of the various feedstocks in a larger global economy, including the improvement in waste management and collection programmes in many parts of the developing world.

Biogas is a mixture of methane, CO2 and small quantities of other gases that can be used to generate power and to meet heating or cooking demand. Its uses and competitiveness depend on local circumstances, but a common element is that biogas offers a sustainable way to meet community energy needs, especially where access to national grids is more challenging or where there is a large requirement for heat that cannot be met by renewable electricity. In developing countries, biogas reduces reliance on solid biomass as a cooking fuel, improving health and economic outcomes. In the SDS, biogas provides a source of clean cooking to an additional 200 million people by 2040, half of which in Africa.

Biogas can also be upgraded to produce biomethane by removing the CO2 and other impurities.

Mtoe

Biomethane is a near-pure source of methane produced either by “upgrading” biogas or through the gasification of solid biomass; since it is indistinguishable from the regular natural gas stream, it can be transported and used wherever gas is consumed, but without adding to emissions. Biomethane grows rapidly in IEA scenarios. It allows countries to reduce emissions in some hard-to-abate sectors, such as heavy industry and freight transport. It also helps to make some existing gas infrastructure more compatible with a low-emissions future, thereby improving the cost-effectiveness and security of energy transitions in many parts of the world.

Biomethane in the SDS avoids around 1 000 million tonnes (Mt) of GHG emissions in 2040. This includes the CO2 emissions that would have occurred if natural gas had been used instead, as well as the methane emissions that would otherwise have resulted from the decomposition of feedstocks.

The outlook for global biomethane consumption by region

Rest of world

200

50

Notes: 1 Mtoe = 11.63 TWh = 1.21 bcm-equivalent to natural gas. China = People’s Republic of China.

With the exception of some landfill gas, most of the biomethane assessed in this report is more expensive than the prevailing natural gas prices in different regions. The average price for biomethane produced today is around USD 19 per million British thermal units (MBtu), with some additional costs for grid injection. However, this report estimates that around 30 Mtoe (~40 billion cubic metres [bcm]) of biomethane – mostly landfill gas – could be produced today at a price that undercuts the domestic price of natural gas; this is already ten times more than total biomethane consumption today.

The cost gap is projected to narrow over time as biomethane production technologies improve and as carbon pricing in some regions makes natural gas more expensive. Recognition of the value of avoided CO2 and methane emissions goes a long way towards improving the costcompetitiveness of biomethane.

Cost ranges for developing global biomethane potential today

210

400

150

200

35

USD/MBtu potential

Multiple fuels and technologies will be required to accelerate energy transitions, and low-carbon gases – led by biomethane and low-carbon hydrogen – have critical roles to play. The 20% share of electricity in global final consumption is growing, but electricity cannot carry energy transitions on its own against a backdrop of rising demand for energy services. Biomethane is the largest contributor to lowcarbon gas supply in the time horizon of the

World Energy Outlook (WEO) Scenarios. How the biogas and biomethane industry evolves will vary by country depending on the sectoral focus, feedstock availability, prevailing market conditions and policy priorities. In all cases, however, realising the multiple benefits of biogas and biomethane requires co-ordinated policymaking across energy, transport, agriculture, environment and waste management.

Final energy consumption by carrier in 2018 and 2040 in the SDS

3 000

2 000

1 000

Note: Low-carbon gases include low-carbon hydrogen, biomethane and low-carbon synthetic methane, along with gas-based carbon capture, utilisation and storage (CCUS) used in large-scale industry.