The global bioenergy market size was valued at USD 156.85 billion in 2025 and is projected to grow from USD 168.93 billion in 2026 to USD 305.79 billion by 2034, registering a CAGR of 7.7% during the forecast period from 2026 to 2034. North America dominated the bioenergy market with a market share of 38.4% in 2025.
Bioenergy is renewable energy produced from organic materials such as agricultural residues, wood, animal waste, food waste, and dedicated energy crops. These resources can be converted into electricity, heat, biogas, or biofuels through processes such as combustion, anaerobic digestion, and fermentation. Bioenergy helps reduce dependence on fossil fuels, supports waste utilization, lowers greenhouse gas emissions, and contributes to a more sustainable and diversified energy system.
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Growing Commercial Expansion of Biomethane Production
The bioenergy market is increasingly moving toward large-scale biomethane production that converts agricultural residues, organic waste, and other biodegradable materials into pipeline-quality renewable gas. Unlike intermittent renewable electricity, biomethane can use existing gas infrastructure and provide dispatchable energy for industrial heating, transport, and other applications. The expansion of dedicated production facilities is strengthening the role of renewable gas within the broader energy transition. Commercial biomethane capacity is therefore becoming an important part of bioenergy market trends.
In July 2026, Axpo began injecting biomethane from its Grottole facility into the natural-gas grid. The plant is designed to produce approximately 45 GWh of biomethane annually from agricultural by-products while also producing fertilizer.
Increasing Use of Biofuels in Maritime Transportation
Shipping companies are expanding their use of biomass-derived fuels as they seek alternatives to conventional bunker fuels. Bio-methanol, biodiesel, biomethane, and bioethanol can be used in compatible engines while taking advantage of renewable and waste-derived feedstocks. Deployment of dual-fuel vessels is also creating long-term demand for reliable biofuel supply chains at major ports. Marine decarbonization is consequently expanding the bioenergy industry beyond traditional electricity, heating, and road-transport applications.
In December 2025, Maersk announced a new fuel trial using a 50% ethanol and 50% methanol blend aboard Laura Mærsk after successfully testing a 10% ethanol blend. By 2025, its fleet was expected to include 19 dual-fuel vessels capable of supporting lower-emission fuel deployment.
Rapid Expansion of Renewable Gas Infrastructure
Development of new biomethane plants is increasing the amount of renewable gas available for direct industrial consumption and injection into existing gas networks. Anaerobic digestion provides an additional revenue pathway for agricultural and food residues while producing a storable energy carrier that can substitute for fossil natural gas. Long-term purchasing agreements also provide developers with greater revenue certainty for new facilities. Expansion of renewable gas infrastructure is therefore strengthening bioenergy market demand.
In January 2026, ENGIE signed a 10-year biomethane purchase agreement with PepsiCo and began developing a new anaerobic-digestion facility with annual production capacity of 60 GWh. The project is expected to reduce PepsiCo's emissions by more than 10,900 tonnes annually.
Limited Availability of Sustainable Biomass Feedstocks
Bioenergy projects depend on a reliable supply of biomass, but agricultural residues, forestry materials, used oils, animal fats, and organic wastes are also required by other industries. Transport distance, seasonal availability, moisture content, sustainability certification, and competing uses can increase procurement costs and restrict the economically viable radius around production facilities. Food-based feedstocks can create additional concerns about land competition. Feedstock limitations can consequently restrain bioenergy market growth even where production technology is commercially available.
In November 2025, PETRONAS and its partners began construction of a biorefinery designed to process up to 650,000 tonnes of renewable feedstocks annually. The facility will rely on materials including used vegetable oils, animal fats, and vegetable-oil-processing residues, illustrating the substantial feedstock volumes required by commercial bioenergy projects.
Expansion of Biomass-Derived Sustainable Aviation Fuel
Aviation provides a major opportunity because long-distance aircraft remain difficult to electrify and therefore require energy-dense liquid fuels. Biomass-derived ethanol can be converted through alcohol-to-jet processing into sustainable aviation fuel compatible with existing aircraft and fuel infrastructure. Increasing blending requirements are creating a clearer commercial pathway for large production projects. SAF can therefore help producers increase bioenergy market share within a high-value transport-fuel application.
In June 2026, Technip Energies, Airbus, Safran, and Tereos agreed to establish the Rebound joint venture for an alcohol-to-jet SAF project with planned annual production capacity of approximately 160,000 tonnes. SAF blending requirements applicable to the targeted market are scheduled to increase from 6% in 2030 to 70% by 2050.
Scaling Bioenergy Without Compromising Feedstock Sustainability
Increasing bioenergy production can create environmental trade-offs when biomass sourcing contributes to deforestation, land conversion, biodiversity loss, or competition with food and animal feed. Producers must therefore evaluate lifecycle emissions and establish traceable sourcing rather than assuming that every biological feedstock is automatically sustainable. Certification becomes particularly difficult when supply chains involve numerous farms, waste collectors, and processing facilities. Maintaining credible sustainability standards remains a major challenge as bioenergy market size expands.
In February 2025, the Roundtable on Sustainable Biomaterials strengthened implementation of its sustainability framework, which evaluates certified biomass and biofuel supply chains against 12 principles covering areas such as greenhouse-gas emissions, biodiversity, soil, water, land rights, and food security.
Solid Biomass Segment Dominated the Market with 41.5% Share in 2025
The solid biomass segment dominated the global bioenergy market with a 41.5% market share in 2025, valued at USD 65.09 billion. The segment's leadership is supported by the established use of wood pellets, agricultural residues, forestry by-products, and other biomass materials for electricity and heat production. Existing biomass infrastructure and the ability to utilize locally available organic resources continue to support solid biomass adoption across industrial, commercial, and utility-scale energy applications.
Liquid biofuels, biogas, and other bioenergy products continue to expand as countries seek alternatives to fossil fuels and greater utilization of organic waste resources. Improvements in conversion technologies, waste management systems, and renewable fuel production are broadening the role of these products across energy and transportation applications.
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Biochemical Processes Segment is Projected to Register the Fastest Growth at a CAGR of 9.41%
The biochemical processes segment is projected to register the fastest growth at a CAGR of 9.41% during the forecast period. Increasing utilization of anaerobic digestion and fermentation technologies is supporting the conversion of agricultural residues, organic waste, wastewater-derived materials, and other biological feedstocks into biogas and biofuels. These processes also support circular-economy objectives by transforming biodegradable waste streams into useful energy products.
Thermochemical and other conversion processes remain important for producing energy from a diverse range of biomass feedstocks. Continued advances in combustion, gasification, pyrolysis, and related technologies are helping improve feedstock flexibility, conversion efficiency, and the utilization of biomass resources.
Agricultural Waste Segment Dominated the Market with 34.7% Share in 2025
The agricultural waste segment dominated the global bioenergy market with a 34.7% market share in 2025, valued at USD 54.43 billion. Agricultural residues such as crop stalks, husks, straw, manure, and processing by-products provide an abundant feedstock base for bioenergy production. Converting these materials into useful energy can reduce waste disposal requirements while creating additional value from resources generated throughout agricultural operations.
Wood waste, solid waste, and other feedstocks continue to contribute to bioenergy production as energy producers seek diverse and locally available raw materials. Improved waste collection, segregation, processing, and conversion infrastructure is supporting more effective utilization of these resources for renewable energy generation.
Transportation Segment is Projected to Register the Fastest Growth at a CAGR of 9.82%
The transportation segment is projected to register the fastest growth at a CAGR of 9.82% during the forecast period. Increasing efforts to reduce dependence on petroleum-based fuels and lower transport-related emissions are supporting greater use of bioethanol, biodiesel, renewable fuels, and biomethane. Bioenergy is particularly relevant for transport applications where direct electrification can be more challenging, creating opportunities for advanced and lower-carbon biofuels.
Power generation, heat generation, and other applications continue to represent important areas of bioenergy consumption. Biomass and biogas can support electricity production, industrial heating, district energy systems, and combined heat and power applications while contributing to broader renewable energy and resource-utilization goals.
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The North American bioenergy market accounted for 38.4% of the global market, reaching USD 60.23 billion in 2025, and is projected to grow at a CAGR of 8.75% during the forecast period. Market growth is driven by increasing demand for renewable energy, government support for clean energy generation, rising investments in biomass-based power and biofuels, and growing efforts to reduce greenhouse gas emissions. The availability of biomass resources and increasing adoption of sustainable energy solutions further support regional market expansion.
The United States represents a major market in North America. Growing investments in renewable energy, increasing production of biofuels, supportive clean energy initiatives, and rising utilization of agricultural and forestry biomass continue to support bioenergy market growth.
Canada's abundant biomass resources, growing renewable energy investments, and increasing focus on low-carbon energy generation continue to support the development of bioenergy projects and technologies.
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The European bioenergy market accounted for 29.6% of the global market, reaching USD 46.43 billion in 2025, and is expected to register a CAGR of 8.41% during the forecast period. Increasing emphasis on renewable energy integration, decarbonization targets, sustainable waste management, and development of biomass-based power and heating systems continue to support regional market growth.
Germany represents a major European market. Strong renewable energy adoption, established biomass power generation, increasing use of biogas, and continued emphasis on reducing dependence on fossil fuels support market development.
The United Kingdom's focus on renewable energy, development of bioenergy and waste-to-energy projects, and increasing efforts to reduce carbon emissions continue to strengthen demand for bioenergy solutions.
The Asia Pacific bioenergy market accounted for 23.2% of the global market, reaching USD 36.39 billion in 2025, and is projected to grow at a CAGR of 10.38% during the forecast period. The region records the fastest growth among the listed markets, supported by rapid industrialization, increasing energy demand, abundant agricultural residues, expanding renewable energy investments, and growing government efforts to develop sustainable energy systems.
China represents a major market within the Asia Pacific. Large biomass availability, increasing renewable energy investments, growing waste-to-energy deployment, and efforts to diversify the energy mix continue to drive bioenergy market expansion.
India's large agricultural residue base, increasing renewable energy investments, growing demand for decentralized energy generation, and initiatives supporting biofuels and biomass utilization continue to strengthen the country's bioenergy market.
Japan's focus on renewable energy diversification, biomass power generation, waste utilization, and reduction of carbon emissions continues to support the adoption of bioenergy technologies.
Latin America's bioenergy market accounted for 5.1% of the global market, reaching USD 8.00 billion in 2025, and is expected to grow at a CAGR of 8.66% during the forecast period. The region benefits from extensive agricultural resources, increasing biofuel production, growing renewable energy investments, and rising demand for sustainable alternatives to conventional fossil fuels.
Brazil represents a major regional market. Strong agricultural and sugarcane industries, established biofuel production, abundant biomass resources, and continued investment in renewable energy continue to create opportunities for bioenergy market growth.
The Middle East & Africa bioenergy market accounted for 3.7% of the global market, reaching USD 5.80 billion in 2025, and is anticipated to grow at a CAGR of 7.94% during the forecast period. Growing renewable energy investments, increasing interest in waste-to-energy technologies, rising energy demand, and efforts to diversify energy sources continue to support regional market development.
The UAE's renewable energy investments, waste management initiatives, and growing focus on diversifying the energy mix continue to create opportunities for bioenergy and waste-to-energy technologies.
Saudi Arabia's energy diversification initiatives, growing renewable energy investments, waste management development, and increasing focus on sustainable energy generation continue to support the emerging bioenergy market.
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Author's Details
Research Head
Ismail Sutaria is a market intelligence and strategy professional with over 12 years of experience advising organizations across the chemicals, packaging, industrial machinery, and energy & power sectors. He specializes in delivering data-driven market assessments, commercial due diligence, industry benchmarking, demand forecasting, competitive strategy, and growth advisory that enable businesses to make confident investment and expansion decisions in complex industrial markets.
His expertise spans specialty and commodity chemicals, advanced and sustainable packaging solutions, industrial automation, manufacturing equipment, process engineering, renewable energy, conventional power generation, electrical infrastructure, and industrial technologies. Ismail has developed deep domain knowledge in evaluating market ecosystems, technology evolution, regulatory frameworks, supply-demand dynamics, pricing trends, value chain structures, and competitive landscapes across global and regional markets.
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