Robust growth drives North America RNG market to 604 mmcfd capacity in 2025

The North America renewable natural gas (RNG) market has demonstrated robust growth, expanding 35% since 2023 and adding a record 139 million cubic feet per day (mmcfd) in 2024, according to a recent analysis from Wood Mackenzie.

The report, “Biomethane (RNG) market report: North America”, from Wood Mackenzie’s Biomethane/renewable natural gas service projects the market to add another 70 mmcfd in 2025, bringing total capacity to 604 mmcfd. The transportation sector consumes more than half of RNG production.

Texas leads all states in the US, with 73 mmcfd of activity, followed by Pennsylvania (55) and Ohio (44). Canada currently has 46 mmcfd of activity. Since 2023, M&A activity featured Enbridge's $1.2B acquisition of Morrow Renewables, major investments from Ares, Goldman Sachs, and Stonepeak ($400M into Clean Energy Fuels), a TotalEnergies-Vanguard joint venture, and asset acquisitions by Vitol, Apollo, and Sagepoint Energy.

“Market participants have shown their confidence in the future of RNG through increased M&A activity,” said Natalia Patterson, senior research analyst at Wood Mackenzie. “We forecast RNG production to grow across all types of feedstock and the resource potential for RNG could exceed 7.8 billion cubic feet per day (bcfd) by 2050.”

RNG development prices remain high

Despite robust growth, RNG still faces some challenges, particularly with project development costs.

“High costs will remain an obstacle for new participants entering the market and extended tax incentives will be a key to continued growth of RNG development,” said Patterson.

Clarity on federal subsidies as well as unlocking demand outside of the transportation sector, mainly through voluntary markets driven by utility and corporate decarbonization targets, would be key for the market’s future potential, added Patterson.

“As more states embrace RNG as part of their decarbonization strategy, more clarity on future policy development would also help stabilize prices for environmental attributes (EAs) and boost confidence in the RNG sector’s long-term viability,” said Patterson.