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In this article, we explore Spain's biogas and biomethane market, highlighting its strong growth prospects and regulatory challenges. Investors, energy professionals and project developers need to understand the fragmented legal framework, permitting complexities and social acceptance issues that impact project success. Despite Spain's 2030 target of 20 TWh, current production remains far behind, making decisive action critical. Key priorities include establishing a unified national framework, ensuring grid access and injection capacity, and promoting public awareness. Developers must adopt strategic, sustainable approaches, while policymakers should implement reforms to position Spain as a competitive leader in Europe.
Our Energy team examines the evolution of Spain's biogas and biomethane market, highlighting opportunities and regulatory challenges. With production potential placing Spain among Europe's leaders, we outline key measures to create a competitive regulatory framework and foster sustainable investment and project development.
How do you see Spain's biogas and biomethane market evolving in the coming years?
The updated Integrated National Energy and Climate Plan (Plan Nacional Integrado de Energía y Clima – PNIEC) targets 20 TWh of biogas and biomethane by 2030. Yet, in 2024, production was only 319 GWh (according to the CNMC), underscoring the need for optimal conditions to attract investment. Although a growth trend is evident, the sector currently meets just 0.163% of Spain's gas demand. In short, significant expansion is expected, given its early stage and numerous projects under development.
Spain is the third country with the highest biogas production potential in the European Union (163 TWh annually). The absence of a dedicated biomethane framework is one of the main current challenges. Significant expansion is expected, given its early stage and numerous projects under development.
What are the main regulatory or permitting challenges for developers in Spain?
The absence of a dedicated biomethane framework is one of the main current challenges. Regulation remains fragmented and subject to inconsistent regional interpretations, complicating efficient project delivery. Developers must consider raw material proximity, network access, and social opposition, while navigating frequent rule changes on grid capacity and opaque processes for gas network connections. This situation, combined with the conditional injection capacity currently granted to such projects, further limits project appeal.
What measures could make Spain's biogas and biomethane market more competitive?
Spain is the third country with the highest biogas production potential in the European Union (163 TWh annually), behind Germany and France.
To unlock this potential, Spanish lawmakers could:
- grant biomethane projects public utility status;
- grant them preferential demand access capacity to the electricity grid without subjecting them to capacity tenders;
- guarantee injection capacity into natural gas networks by amending current regulations that only allow conditional capacity; and
- create a basic, specific, state-level regulatory framework.
Public authorities should also promote awareness campaigns to increase social acceptance of these projects, while developers should prioritise responsible, safe, sustainable and transparent development.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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