Compressed Biogas Market Size, Share & Growth Forecast (2026-2031)

The Compressed Biogas Market is projected to grow from USD 7.48 billion in 2026 to USD 12.05 billion by 2031, at a CAGR of 10.0% during forecast period.

The primary feedstocks for biogas and compressed biogas (CBG) production in India include agricultural residues, animal manure, and municipal solid waste. Municipal solid waste and agricultural residues are major feedstock sources, supported by urban waste generation and the availability of paddy straw. By application, vehicle fuel is the leading end use, followed by industrial applications, cooking fuel, and city gas distribution.

Key growth drivers include the expanding adoption of CBG in commercial transport fleets, investments in advanced biogas upgrading technologies, integration of CBG into city gas distribution networks, decentralized renewable energy production, and rising demand for low-carbon industrial fuels. Major market trends include increased utilization of agricultural waste and the development of industrial-scale anaerobic digestion facilities.

North America's market is supported by low-carbon fuel credit mechanisms and renewable natural gas programs, while Asia-Pacific is projected to witness strong growth, driven by renewable gas initiatives and India's expanding CBG ecosystem. The Indian market remains moderately fragmented, with several established energy companies and technology providers competing across the value chain. Key players include Reliance Bio Energy, IndianOil, BPCL, Adani TotalEnergies Biomass, HPCL, GAIL, and Praj Industries.

Market Dynamics

Market Drivers

• CBDGs are set to benefit from a rapidly expanding addressable market as demand for low-carbon fuels in commercial transport fleets and industry grows, due to blending requirements and low-carbon fuel incentives.

• The integration of CBG into city gas distribution networks and the increase in the refueling infrastructure are creating greater certainty of offtake for producers.

• Feedstock availability is growing due to increased amounts of agricultural and municipal organic waste as well as policies designed to reduce crop-residue burning and landfill methane.

• Innovative technology for upgrading and compressing biogas is reducing the costs and enhancing the quality of the gas.

Market Restraints & Opportunities

The speed of scale-up is constrained by high capital cost of plants and upgrading equipment, largely due to the logistics and price volatility of feedstock, offtake and pricing uncertainty, and reliance on policy support for project economics.

However, opportunities for plant developers, technology suppliers and fuel distributors are growing rapidly thanks to decentralized production, gas quality standardization, carbon-credit revenues and the rising demand from fleets and industry.

Key Developments

• August 2026: BP has awarded global automation leader Emerson, a multi-million-dollar contract to deliver automation technologies for the Shah Deniz Compression project off the coast of Azerbaijan.

• July 2026: Burckhardt Compression confirms the completion of the acquisition of Fornovo Gas S.p.A.

Compressed Biogas Market Segmentation

The market is segmented by feedstock, application, end user, and geography.

By Feedstock

• Agricultural Residues, Manure and Municipal Solid Waste

The main feedstocks are agricultural residues, animal manure and municipal solid waste, the mix depending on regional availability and policy; in addition, residue-based projects can help alleviate the problem of crop burning.

Verbio SE is a European biomethane producer of agricultural residues, working both in Europe and India.

Praj Industries Ltd. offers bioenergy technology solutions and CBG plant solutions.

By Application

• Vehicle Fuel

The biggest application is in vehicle fuel, with CBG use existing in compressed natural gas (CNG) vehicles and stations, with commercial fleets and public transport.

Indian Oil Corporation Ltd. is building CBG supply and retail stores in India's national initiative.

Gasum Oy is the producer and distributor of biogas for transport in the Nordic region.

Regional Analysis

• North America

North America had the highest regional penetration in 2025, partly driven by renewable NG programs, low carbon fuel credits and a solid number of landfill, dairy and wastewater projects.

• Europe

The biomethane industry in Europe is well developed, with grid injection and transport use with renewable gas targets and incentives in Germany, France, Italy, Nordics and the Netherlands.

• Asia-Pacific

Asia-Pacific is forecast to grow fastest, led by India's national CBG program and by large-scale organic waste and rural biogas initiatives in China and Southeast Asia.

• Middle East and Africa

The Middle East and Africa are an early-stage market, with interest focused on municipal waste-to-energy and fleet fuel pilots.

• South America

South America offers growing potential from sugarcane, livestock and landfill resources, with Brazil advancing biomethane policy and projects.

List of Companies

Air Liquide S.A.

Veolia Environnement S.A.

Gasum Oy

Verbio SE

Reliance Bio Energy

Indian Oil Corporation Ltd.

GAIL (India) Ltd.

Adani TotalEnergies Biomass Ltd.

Praj Industries Ltd.

EverEnviro Resource Management

Competitive Landscape

Air Liquide S.A.

Air Liquide supplies biogas purification and liquefaction technology and distributes biomethane for mobility and industrial use as part of its renewable gas activities.

Verbio SE

Verbio produces biomethane and biofuels from agricultural residues, with operations in Europe and expansion into India.

Indian Oil Corporation Ltd.

IndianOil is a leading Indian energy company developing CBG supply, offtake and retail outlets under the government's national program, alongside peers such as GAIL, BPCL and HPCL.

Analyst View

The Compressed Biogas market is growing quickly because it turns waste into a drop-in fuel that works with existing gas vehicles and networks, and because governments are backing it with targets, blending rules and incentives. Estimates vary widely by scope and by country, so users should read headline numbers against definition. India is the most dynamic national market, while North America and Europe continue to scale renewable natural gas. Success depends on securing feedstock, controlling plant costs and locking in offtake with fleets and city gas distributors. Companies that integrate feedstock aggregation, upgrading technology and fuel distribution are best positioned.

Compressed Biogas Market Scope: