Biogas vs biomethane

Biogas and biomethane are often mentioned together, and they start from the same process. Commercially, however, they are different products, with different equipment, customers and revenue models. For anyone assessing a project, understanding the difference is the starting point.

Biogas: the raw product

Biogas is produced by anaerobic digestion — the breakdown of organic material by bacteria in the absence of oxygen, inside sealed tanks called digesters. Common feedstocks include agricultural residues, animal manure, food and organic waste, sewage sludge and energy crops.

Raw biogas is typically around 50–70% methane, with most of the remainder carbon dioxide and small amounts of water vapour, hydrogen sulphide and other trace compounds. Its most common use is on-site combustion in gas engines that produce electricity and heat together (combined heat and power, or CHP).

Biomethane: biogas upgraded

Biomethane — also called renewable natural gas — is biogas that has been cleaned and upgraded by removing the carbon dioxide and impurities. The result is typically more than 95% methane and can be used in the same way as natural gas.

Upgrading is done with established technologies such as membrane separation, water scrubbing, pressure swing adsorption or chemical (amine) scrubbing. Once upgraded, biomethane can be injected into the gas grid, compressed or liquefied for use as a transport fuel, or supplied to industrial users.

Different products, different revenue models

The commercial difference is what the project sells. A biogas-to-power plant sells electricity — and, where there is a nearby user, heat. Its economics depend on the electricity price or contract it can secure, its grid connection, and whether the heat can be used rather than wasted.

A biomethane plant sells gas. It needs a connection to the gas grid or a direct customer, and it may also earn revenue from renewable gas certificates, depending on the market. Upgrading adds capital and operating cost, so biomethane projects generally need a larger and steadier gas output to justify it.

• Biogas to power: electricity and heat; needs a power grid connection and ideally a heat user
• Biomethane: grid-quality gas; needs a gas grid connection or direct offtaker, and upgrading equipment
• Both: produce digestate, a nutrient-rich by-product that can often be used as fertiliser

Feedstock is the conversation, not the footnote

Whichever product a project makes, its credibility rests on feedstock. A digester needs a steady, predictable supply of suitable material for the whole life of the plant. Investors will ask where it comes from, under what contracts, at what cost, how far it travels, and what happens if a supplier stops.

Feedstock quality matters as much as quantity: different materials produce very different volumes of gas. A project that can show contracted, well-characterised feedstock from nearby sources is in a much stronger position than one relying on assumptions.

Which is the better investment?

Neither is inherently better. The right choice depends on location, scale, feedstock, grid access and the local market for electricity, heat and gas. Some projects start with power generation and add upgrading later; others are designed for biomethane from the beginning.

For investors, the useful question is not “biogas or biomethane?” but “does this project’s choice fit its feedstock, its connections and its customers?”