06-2026 Newsletter Task 37
Newsletter IEA Bioenergy Task 37: 06/2026
Policy
Topics:
- India to remove excise duty on biogas blended with CNG
- South Korea publishes 2026 output targets for biogas producers
- Environmental groups petition to end federal grants for on-farm digesters
- USDA pauses on-farm digester loan agreements
- Trump signs $8.8B EPA budget bill
- China lays out blueprint for green trade expansion
- New Mexico finalizes rules for Clean Fuel Program, boosting biogas potential
- Italy finalises biomethane funding system
- Russian gas imports: Council gives final green light to a stepwise ban
- Australian renewable agency fund excludes some biofuels
- What are France’s ambitions for biomethane?
- Netherlands Delays Green Gas Mandate
- German Federal Network Agency: Max. 2026 values for biomethane tenders
- Sweden launches $106 million biogas production package
- Italy Extends Its Retrofit Incentive for CNG Vehicles
- In Canada, the government is supporting the transition of vehicle fleets to natural gas
- Polish parliament approves biomethane amendments
- Australia: NSW’s Renewable Gas Production Program
- USA: Farm bill draft heads to House floor with food waste provisions
- Biomethane could meet half of New Zealand’s natural gas demand by 2050
- India expands CBG scheme, allows pipeline injection to cut LNG dependence
India to remove excise duty on biogas blended with CNG
In order to avoid cascading of taxes on blended compressed natural gas, the Finance Minister Nirmala Sitharaman proposed to exempt excise duty on GST-paid compressed biomethane contained in it. To further provide impetus to green mobility, she announced to extend the customs duty exemption to import of capital goods and machinery required for manufacture of lithium-ion cells for batteries used in electric vehicles.
South Korea publishes 2026 output targets for biogas producers
The Ministry of Environment pre-announced legislation of the subordinate statutes of the “Act on the Promotion of Production and Use of Biogas using Organic Waste”. According to the draft, mandatory producers in the public sector will be given a target production rate of 50% in 2025 and 80% in 2045. Mandatory producers in the private sector will be given a target production rate of 10% in 2026 and 80% in 2050. Mandatory producers in the private sector include those who discharge livestock excreta with more than 20,000 or more pigs, livestock excreta disposal facilities with a daily capacity for treatment of 100 tons or more supported by the central or local governments, and those who discharge food waste with an annual emission of 1,000 tons or more.
Environmental groups petition to end federal grants for on-farm digesters
A coalition of 34 environment and agriculture groups are urging the U.S. Department of Agriculture to declare on-farm manure digesters ineligible for funding through the Rural Energy for America Program. The groups include environmental organizations such as Friends of the Earth, the Waterkeeper Aliance and Food & Water Watch, as well as agriculture-centered advocacy groups like Farm Aid and Animal Legal Defense Fund. They say digesters do not provide sufficient benefits and take money away from other projects that could be funded through the Rural Energy for America program. The petition comes amid continued advocacy against government programs that subsidize anaerobic digesters.
USDA pauses on-farm digester loan agreements
The U.S. Department of Agriculture’s Rural Business Cooperative Service (RBCS) on Friday paused the acceptance, processing and awarding of loan note guarantees to anaerobic digesters for up to 90 days while it conducts an investigation into loan delinquencies and project underperformance. Projects in the Rural Energy for America Program that had already received such agreements are still able to access funding. In the announcement, RBCS disclosed 21 loans to digester projects totaling $386.4 million are seeing a delinquency rate of 27%. On April 7, the federal agency’s pause on loan guarantees for new projects will extend past the 90-day deadline and will now go through the end of the year.
Trump signs $8.8B EPA budget bill
President Donald Trump approved a funding bill package on Friday that includes $8.8 billion for the U.S. EPA. That budget is $320 million less than the previous year’s fiscal year budget, but avoids the major cuts the White House had previously proposed. The funding is about 4% less than last year but more than 50% than a previous White House proposal. It cuts funding for Superfund activities but maintains other operations funding and research. The bipartisan group also urged EPA Administrator Lee Zeldin to restore staffing levels at the agency after last year’s furloughs and layoffs.
China lays out blueprint for green trade expansion
China’s Ministry of Commerce issued a sweeping directive system, requiring clean marine fuels, carbon footprint tracking, and bonded fuel supply at ports, positioning Chinese institutions to influence international rule making on green fuels and certification. Greece is working with the US and Saudi Arabia on an , sidelining Brussels as the EU remains unable to agree on a common IMO position. The move marks Athens’ second break from the bloc after abstaining from the vote in October on the Net-Zero Shipping Framework.
New Mexico finalizes rules for Clean Fuel Program, boosting biogas potential
New Mexico’s Environmental Improvement Board voted on Thursday to approve rulemaking for the state’s Clean Transportation Fuel Program after an extensive public hearing process. New Mexico is one of the country’s largest producers of fossil fuels, but its biofuels industry is relatively small with only 16 biogas plants according to ABC. The new law requires average carbon intensity of fuels used in the state to decline by 20% by 2030 and 30% by 2040, compared with a 2018 baseline.
Italy finalises biomethane funding system
Italy has finalized a €2.2 billion funding scheme to accelerate national biomethane production, aiming for 5.8 billion cubic meters (bcm) annually by 2030. This target nearly doubles Italy’s current production. Supported by the EU-backed National Recovery and Resilience Plan (PNRR), the scheme provides capital grants (up to 40%) and 15-year tariffs for projects coming online by mid-2028, focusing on agricultural waste and manure. Funding supports new, upgraded, or converted biomethane plants, with a focus on advanced biomethane for transport and heating. The initiative strongly supports the agricultural sector, utilizing manure and agricultural by-products.
Russian gas imports: Council gives final green light to a stepwise ban
End of January, the 27 EU member states formally adopted the regulation on phasing out Russian imports of both pipeline gas and liquified natural gas (LNG) into the EU. The new rules also include measures on effective monitoring and diversification of energy supply. According to the regulation, importing Russian pipeline gas and LNG into the EU will be prohibited. The ban will start to apply six weeks after the regulation enters into force. Existing contracts will have a transition period. This stepwise approach will limit the impact on prices and markets. A full ban will take effect for LNG imports from the beginning of 2027 and for pipeline gas imports from autumn 2027. By 1 March 2026, EU countries must prepare national plans to diversify gas supplies and identify potential challenges in replacing Russian gas.
Australian renewable agency fund excludes some biofuels
The Australian Renewable Energy Agency (Arena) has released the structure of its updated low-carbon liquid fuels (LCLF) funding round under the Future Made in Australia (FMA) innovation fund, with a narrower fuel scope that excludes biodiesel, biomethane, hydrogen and ammonia-based fuels from eligibility. Arena will only support projects producing sustainable aviation fuel (SAF), renewable diesel (RD) and methanol, describing these as having the highest innovation potential and strongest market demand in hard-to-electrify sectors such as aviation, long-haul freight, mining and maritime transport.
What are France’s ambitions for biomethane?
Early February, the French government published its third Multi-Year Energy Program (PPE 3). This eagerly awaited document covers the period 2023-2035 and sets out the trajectories for France’s various energy sectors, including biomethane. While the text emphasises low-carbon electrification and the revival of nuclear power, it also sets targets for so-called “non-electric” sectors. Biomethane is one of the levers identified to reduce the share of fossil fuels, which is to fall from 58% in 2023 to 40% in 2030. The PPE 3 forecasts an increase in biomethane production from 9 TWh today to 47-82 TWh in 2035. An intermediate milestone is set at 44 TWh injected in 2030, almost three times more than the current capacity of 15.7 TWh with more than 800 injection sites in service. Beyond biomethane, PPE 3 sets trajectories for the entire energy system. Among other energy sources, biofuels are expected to reach between 70 and 90 TWh by this horizon, compared to 38 TWh today.
More (in French)
Netherlands Delays Green Gas Mandate
The Netherlands has pushed back its mandatory green gas blending requirement to January 2027 instead of 2026, raising fresh doubts about Europe’s ability to scale biomethane production tenfold by 2030. To offset the setback, Dutch authorities have attached higher blending targets to the first year of implementation — a compromise that reflects both genuine political commitment to green gas and the considerable difficulty of deploying it at scale. The timing is awkward for Brussels. The European Union’s REPowerEU plan, launched to end dependence on Russian pipeline gas, calls for 35 billion cubic metres of biomethane production annually by 2030. The challenge is not unique to Europe. In the United States, the Inflation Reduction Act has turbocharged investment in renewable natural gas through tax credits, but project developers there similarly cite permitting bottlenecks and grid interconnection delays as persistent obstacles. Japan and South Korea, both heavily dependent on liquefied natural gas imports, are exploring domestic biomethane blending as part of broader hydrogen and green gas strategies
German Federal Network Agency: Max. 2026 values for biomethane tenders
The German Federal Network Agency has published two specifications for the maximum values for tenders for biomass and biomethane plants in 2026. The maximum value for new biomass plants is 19.43 ct/kWh, and for existing biomass plants it is 19.83 ct/kWh. A maximum value of 23.13 ct/kWh has been set for biomethane plants. No bids were submitted for biomethane tenders last year. The expected electricity production costs also suggest that the previous maximum value is not sufficient to cover the tender volume. The Federal Network Agency has therefore increased the maximum value by 10 percent compared to the previous year. This creates additional incentives to submit bids in upcoming tenders. The increase corresponds to the maximum increase permitted by law. The specifications apply to tenders in the coming twelve months. This means that they already apply to the two bidding dates for the biomass and biomethane tenders on April 1, 2026.
More (in German)
Sweden launches $106 million biogas production package
Sweden has opened applications for gaseous and liquified biogas production support, allocating a SEK 1.035 billion ($106 million) budget covering manure-based biogas and upgraded biomethane. The scheme provides compensation per kilowatt-hour of biogas produced from manure and per kilowatt-hour of biogas upgraded to biomethane, regardless of whether delivered in gaseous or liquid form. Under the Swedish scheme, the plant must produce biogas within Sweden, with said production occurring between 1 January 2026-31 December 2026. Likewise, feedstocks used in the production process must align with the EU RED III, Annex IX, which includes feedstocks such as manure, municipal biowaste, agricultural residues, wastewater sludge, used cooking oil, Category 1&2 tallow, lignocellulosic materials and algae grown on land.
Italy Extends Its Retrofit Incentive for CNG Vehicles
Italy is allocating €1.6 billion to support its automotive sector through 2030. The new plan prioritizes innovation and retrofitting, with a targeted return to subsidies for conversions to LPG and CNG. Having launched new subsidies for the purchase of CNG trucks a few weeks ago, the government recently unveiled a new support plan for the automotive sector. Covering the period 2026–2030, this new fund amounts to approximately 1.6 billion euros. While it excludes, at this stage, the return of widespread incentives for the purchase of new cars, the government is focusing resources on measures designed to support the industry and the transition of the existing vehicle fleet. While €750 million will be allocated to supporting innovation and €450 million to supporting manufacturers—including the consolidation of existing sites and support for mid-sized projects—over the 2026–2030 period, €21 million will be dedicated to converting passenger and commercial vehicles to LPG and CNG.
More (in French)
In Canada, the government is supporting the transition of vehicle fleets to natural gas
Ottawa has announced new funding to support 155 projects focused on sustainable mobility. The federal government is allocating $97 million (€60 million) toward infrastructure, fleet modernization, and public awareness initiatives. $84.4 million (€52 million) will fund 122 projects to install over 8,000 charging stations for electric vehicles, while approximately $5.7 million (€3.5 million) is earmarked for the transition to CNG through purchase incentives provided to transport companies. Specifically, three companies are receiving support under the program: UPS Canada, Tomlinson, and Westcan Bulk Transport. Ottawa has also allocated 7.2 million Canadian dollars for 30 projects focused on education and awareness.
More (in French)
Polish parliament approves biomethane amendments
Currently, only biomethane producers with plants of capacity up to 1 MW are supported via a feed-in-premium scheme (contract for difference or CfD), under which they are free to sell biomethane on the market but have the right to settle the negative balance resulting from the difference between the market price and the reference price. This scheme has had its drawbacks, one being the limited time to start using this system. Originally, it was possible to do so until 30 June 2024. Recently, this solution has been changed, and it is possible to enter the support scheme until 30 June 2027. Another drawback was that the scheme was only available to producers using limited capacity installations. The act aims to remedy this by introducing a completely new support scheme exclusively for biomethane producers in plants with a capacity of more than 1 MW.
Australia: NSW’s Renewable Gas Production Program
Authorities in the Australian state of New South Wales have set aside AUD 40 million ($28.5m) to boost biomethane production. The support within the Renewable Gas Production Program is part of the Industrial Decarbonisation Initiative and a core component of the NSW Renewable Fuels Strategy. The program is supporting projects that operate across the full biomethane value chain. They should integrate feedstock preparation, production, delivery and injection into the NSW gas network. To be eligible for this grant, the applicant must plan to own or have operational control over a biomethane production plant in NSW. By the full application stage, also agreements must be in place with: NSW feedstock suppliers, NSW gas network owners or operators to enable injection into the gas pipeline, and an industrial off-taker in NSW that will use the biomethane.
USA: Farm bill draft heads to House floor with food waste provisions
Mid-March, the House Agriculture Committee passed its markup of the Farm, Food, and National Security Act of 2026. The draft instructs USDA to provide research funding for food loss and waste. The bill would also expand funding for certain kinds of biogas projects and allow anaerobic digesters to receive funding under the created by the last farm bill. That program is authorized to disburse $25 million annually and has supported more than 100 projects to date. The new bill would make permanent the Composting and Food Waste Reduction Cooperative Agreements program, which was described as a pilot in the previous farm bill.
Biomethane could meet half of New Zealand’s natural gas demand by 2050
Biomethane could meet half of New Zealand’s natural gas demand by 2050, a new report from GasNZ says. The Biomethane Strategy and Action Plan presented to the government at the request of the Minister of Energy and the Minister for the Environment, sets out a viable pathway for getting there. The strategy’s first target, producing one petajoule (PJ) of biomethane per year – the equivalent of one percent of current natural gas production – can be quickly achieved by securing biomethane from projects already under development and upgrading biogas from existing sources. These include wastewater treatment plants and landfills. The strategy could readily scale up to the second target, five petajoules by 2035 – the equivalent of five percent of current natural gas production – which would be enough gas to supply two-thirds of the natural gas used today by typical commercial businesses. The third target, getting to 25 petajoules by 2050 – which would equal half of the expected natural gas needs at that time – will take systematic effort, and international experience shows that it is possible.
India expands CBG scheme, allows pipeline injection to cut LNG dependence
The Indian government has expanded and extended the Compressed Biogas (CBG)-City Gas Distribution synchronisation scheme until 2047, allowing CBG to be injected directly into the national gas pipeline network as part of efforts to strengthen energy security amid global supply concerns. The move comes as India faces pressure on liquefied natural gas supplies, with nearly half of its imports coming from Qatar. At present, the government is prioritizing gas supply for household and transport use, ensuring full availability for domestic CNG, while supply to industrial and commercial users is being regulated.