Synthetic Natural Gas Market

[234 Pages Report] The global synthetic natural gas market is projected to reach USD 68.4 billion by 2029 from an estimated USD 23.9 billion in 2024, at a CAGR of 23.4% during the forecast period. The rise of intermittent renewables necessitates the need for grid balancing and flexibility solutions to match supply with demand. SNG production facilities can be strategically located near renewable energy generation sites, enabling surplus electricity from renewables to be converted into SNG during times of excess generation. This stored energy can then be utilized during peak demand periods or when renewable output is low, thereby enhancing grid stability and resilience.

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Synthetic Natural Gas Market Dynamics

Driver: Technological advanacements in Synthetic natural gas Infrastructure

The rising global demand for natural gas, propelled by factors like population growth and industrial expansion, has led to a growing interest in synthetic natural gas (SNG) as a viable solution. SNG, produced through gasification processes using materials such as coal or biomass, offers versatility in sourcing and production. Unlike conventional natural gas, SNG can be synthesized from various feedstocks, providing flexibility in meeting demand. Moreover, SNG presents environmental benefits, with technologies like carbon capture and storage mitigating its carbon footprint. SNG's potential is particularly noteworthy in regions lacking access to conventional natural gas reserves, offering a sustainable energy alternative. The World Bank underscores the role of natural gas in driving industrial growth in developing nations, with its cleaner combustion making it an attractive option for industries like steel and cement manufacturing, especially in light of tightening environmental regulations.

Restraint: Lack of infrastructure in Market

The synthetic natural gas (SNG) market faces significant obstacles due to inadequate infrastructure, inconsistent regulations, and strong competition from traditional energy sources. Regions lacking pipelines and storage facilities, like parts of Africa, struggle to establish the necessary infrastructure for SNG production and distribution. Moreover, varying emissions standards and safety protocols across jurisdictions create uncertainty for investors. Competition from conventional natural gas and renewables further hampers SNG market growth. In regions with abundant natural gas reserves, like the United States, traditional extraction methods offer cost advantages over SNG. Additionally, the decreasing costs of renewable energy technologies, such as solar and wind power, pose a competitive challenge to both natural gas and SNG.

Opportunities: Increased focus on waste-to-energy projects

The increasing focus on waste-to-energy initiatives presents a notable opportunity for the synthetic natural gas (SNG) market, offering a viable pathway to mitigate environmental impact while fulfilling energy needs. Waste-to-energy projects have the potential to utilize diverse waste sources, including landfill gas, municipal solid waste, and agricultural residues, as inputs for SNG production. This not only redirects waste away from landfills but also mitigates greenhouse gas emissions from decomposition, while concurrently generating a valuable source of clean energy. When waste serves as the feedstock for SNG production, the resulting synthetic natural gas can be classified as renewable SNG (RSNG) if the waste source is biogenic. This distinction significantly enhances the sustainability credentials of SNG compared to its production from fossil fuels. For example, in California, facilities specializing in renewable natural gas (RNG) are leveraging landfill gas and sewage biogas to produce environmentally friendly transportation fuel.

Challenges: Leakage of methane

A significant challenge for Synthetic Natural Gas (SNG) to uphold its environmentally friendly reputation lies in methane leakage. Methane, a potent greenhouse gas with over 80 times the short-term warming potential of carbon dioxide, poses a substantial threat to the climate. Even minor leaks during SNG production can release significant amounts of methane, thereby undermining the emissions reductions achieved by substituting SNG for fossil fuels. According to the Natural Resource Defense Council (NRDC), methane is highly effective at trapping heat in the atmosphere, with a warming potential around 30 times greater than that of carbon dioxide over a century. The environmental advantage of SNG hinges on the materials used and the production process employed. If methane leakage is prevalent, it can nullify the lifecycle greenhouse gas benefits that SNG offers compared to conventional natural gas. Leakage incidents can occur at various stages, including production, transportation, and storage of SNG. Therefore, stringent measures are imperative throughout the entire SNG process to mitigate these fugitive methane emissions.

Synthetic Natural Gas market Ecosystem

In this market, prominent companies stand out as well-established and financially stable providers of synthetic natural gas. With years of experience, these companies boast a diverse product portfolio, cutting-edge technologies, and robust global sales and marketing networks. Their proven track record in the industry positions them as reliable and trusted partners for customers seeking synthetic natural gas. These companies have demonstrated their ability to adapt to market dynamics and consistently deliver high-quality products and services, making them leaders in meeting the demands of the energy and power sector. Prominent companies in this market Basin Electric Power Cooperative (US), Air Liquide (France), EnviTec Biogas AG (Germany), Verbio SE (Germany), Kinder Morgan (US).

The thermal gassification segment, by application, is expected to be the largest market during the forecast period.

This report segments the synthetic natural gas market based on application into four categories: anaerobic digestion & fermentation, thermal gasification, power-to-gas and others. The thermal gasification segment is expected to be the largest market during the forecast period. The need for effective waste management solutions, especially for organic waste streams like agricultural residues and municipal solid waste, is driving interest in thermal gasification for SNG production. Converting waste into valuable energy products helps address both energy and waste management challenges.

By Application, Transportation is expected to be the fastest growing segment during the forecast period.

This report segments the synthetic natural gas market based on application into four segments: Transportation, power generation, industrial, and grid injection. The transportation segment is expected to be the fastest-growing segment of the synthetic natural gas and transportation market during the forecast period. Consumer demand for vehicles powered by cleaner fuels such as synthetic natural gas (SNG) is experiencing a significant upsurge due to a growing awareness of the environmental consequences of traditional fossil fuels. With increased access to information about climate change and air pollution, consumers are becoming more conscious of their carbon footprint and are actively seeking greener alternatives for their transportation needs.

Europe: The largest growing region in the Synthetic Natural Gas market.

Europe is expected to be the largest region in the synthetic natural gas market between 2024–2029. European partnerships with other countries, such as Japan and South Korea, which are also investing heavily in synthetic natural gas technologies, are accelerating the development of global synthetic natural gas supply chain networks.

Key Market Players

The synthetic natural gas market is dominated by a few major players that have a wide regional presence. The major players in the synthetic natural gas market include Basin Electric Power Cooperative (US), Air Liquide (France), EnviTec Biogas AG (Germany), Verbio SE (Germany), Kinder Morgan (US).  Between 2020 and 2024, Strategies such as new product launches, contracts, agreements, partnerships, collaborations, acquisitions, and expansions are followed by these companies to capture a larger share of the synthetic natural gas market.

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Scope of the Report

This research report categorizes the Synthetic natural gas Market based on source, technology, application and region.

On the basis of Application, the Synthetic natural gas market has been segmented as follows:

• Transportation
• Power generation
• Industrial
• Grid injection

On the basis of Technology, the Synthetic natural gas market has been segmented as follows:

• Anaerobic digestion & fermentation
• Thermal gasification
  • Moving bed gasifier
  • Fluidized bed gasifier
  • Entrained flow gasifier
• Power-to-gas
• Others

Based on region, the Synthetic natural gas market has been segmented as follows:

• North America
• Europe
• Asia Pacific
• RoW

Recent Developments

• In April 2024, Air Liquide continues to expand its capacities in biomethane, also known as Renewable Natural Gas (RNG) in the U.S., with the construction of two new production units. These units, located in Center Township, Pennsylvania, and Holland Township, Michigan, will treat waste sourced from dairy farms.
• In April 2024, Brightmark RNG Holdings, a joint venture between Chevron USA Inc. and Brightmark, has opened its Eloy Renewable Natural Gas (RNG) center, producing pipeline fuel by capturing methane from dairy operations. Eloy RNG will produce RNG using anaerobic digesters at the Caballero Dairy farm in Arizona.
• In April 2024, AMERESCO, A leading cleantech integrator specializing in energy efficiency and renewable ENERGY, DEVELOPED and construct advanced technology biogas cogeneration facility for the Sacramento Area Sewer District located at the EchoWater Resource Recovery Facility which will cost nearly USD 140 million.
• In March 2024, Electrochaea and Erik Thun AB have signed an agreement to enter negotiations on the off-take of e-methane to be produced by Electrochaea’ s subsidiary BioCAT Roslev Aps in Denmark for usage as maritime fuel in the vessels operated by Erik Thun AB.  

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