Bioenergy Market Set for Strong Growth Across Transportation, Power and Heat Generation

The global bioenergy market 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 2026–2034. North America dominated the market with a 38.4% share in 2025, while Asia Pacific is expected to register the fastest CAGR of 10.38% during the forecast period.

Market Size (2025): USD 156.85 Billion

Market Size (2026): USD 168.93 Billion

CAGR (Forecast Period): 7.7% during 2026–2034

Forecast Year: 2034

Projected Market Size (2034): USD 305.79 Billion

Dominant Region: North America – 38.4% share in 2025

Fastest Growing Region: Asia Pacific – 10.38% CAGR

Market Overview

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 combustion, anaerobic digestion, fermentation, and other conversion processes.

The market is expanding across power generation, industrial heating, transportation, and renewable gas applications. Growing use of biomass resources for waste utilization and energy production is also broadening the role of bioenergy within diversified renewable energy systems.

Growth Drivers

Expansion of renewable gas infrastructure is supporting bioenergy deployment by increasing the availability of biomethane for industrial consumption, transportation, and injection into existing gas networks. In January 2026, ENGIE signed a 10-year biomethane purchase agreement with PepsiCo and began developing an anaerobic-digestion facility with annual production capacity of 60 GWh.

Long-term purchasing agreements and the ability to convert agricultural and food residues into storable energy are improving the commercial viability of bioenergy projects. These developments are creating additional revenue pathways for biomass and renewable-gas producers.

Market Challenges

Bioenergy projects require consistent access to suitable biomass, while agricultural residues, forestry materials, used oils, animal fats, and organic waste are also utilized by other industries. Seasonal availability, moisture content, transportation distance, sustainability certification, and competing uses can increase procurement costs and complicate project planning.

Sustainability verification across complex biomass supply chains is another challenge. Producers must establish traceable sourcing and evaluate lifecycle emissions, biodiversity, land use, soil, water, and food-security considerations as production capacity expands.

Market Opportunities

Biomass-derived sustainable aviation fuel (SAF) offers a significant commercial opportunity because long-distance aviation continues to require energy-dense liquid fuels. Alcohol-to-jet technologies can convert biomass-derived ethanol into SAF compatible with existing aircraft and fuel infrastructure.

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 of approximately 160,000 tonnes. Such projects create revenue avenues for biofuel producers, technology providers, feedstock suppliers, and renewable-energy developers.

Segment Analysis

By product type, the solid biomass segment dominated the bioenergy market with a 41.5% share in 2025, valued at USD 65.09 billion. Wood pellets, agricultural residues, forestry by-products, and other solid biomass materials remain widely used for electricity and heat production across industrial, commercial, and utility-scale applications.

By technology, the biochemical processes segment is expected to grow at the fastest CAGR of 9.41% during 2026–2034. Anaerobic digestion and fermentation enable the conversion of agricultural residues, organic waste, and other biological feedstocks into biogas and biofuels while supporting waste-to-energy and circular-economy applications.

By feedstock, the agricultural waste segment accounted for a 34.7% share in 2025, valued at USD 54.43 billion. Crop stalks, husks, straw, manure, and agricultural processing by-products provide a broad feedstock base while creating opportunities to convert agricultural residues into useful energy.

By application, the transportation segment is projected to register the fastest CAGR of 9.82% during 2026–2034. Bioethanol, biodiesel, renewable fuels, and biomethane are gaining relevance in transport applications where direct electrification can be more challenging.

Regional Analysis

North America held the largest position in the bioenergy market, accounting for a 38.4% share in 2025 and reaching USD 60.23 billion. The region benefits from substantial biomass resources, renewable-energy investment, biofuel production, and initiatives focused on reducing greenhouse gas emissions.

Asia Pacific is projected to register the fastest CAGR of 10.38% during 2026–2034, supported by agricultural residue availability, renewable-energy investments, waste-to-energy deployment, and efforts to diversify energy systems. China, India, and Japan remain important markets across the region.

Europe accounted for 29.6% of the global market in 2025, while Latin America and the Middle East & Africa represented 5.1% and 3.7%, respectively. Brazil is an important Latin American market due to its agricultural and sugarcane industries, while renewable-energy investment and waste-to-energy initiatives are supporting bioenergy development in the Middle East & Africa.

Competitive Landscape

The bioenergy market includes renewable-energy developers, biomass technology providers, engineering companies, biofuel producers, waste-to-energy operators, and diversified energy companies. Competition is shaped by conversion technology, feedstock access, project development capabilities, production capacity, sustainability credentials, and regional infrastructure.

Key companies include:

Mitsubishi Heavy Industries Ltd

MVV Energie AG

A2A SpA

Hitachi Zosen Corp

BTG Biomass Technology Group

Babcock & Wilcox Volund A/S

Biomass Engineering Ltd

Orsted A/S

Enerkem

Fortum Oyj

ADM (Archer Daniels Midland Company)

INEOS Bio

Abengoa Bioenergy

Neste

Novozymes

Recent Developments

In June 2026, Neste expanded renewable-fuel production capacity at its Rotterdam refinery, strengthening its renewable diesel and sustainable aviation fuel portfolio. In May 2026, TotalEnergies and Quatra expanded their partnership to increase the collection and processing of used cooking oil across Europe for biofuel and circular-energy applications.

In November 2025, BP commissioned additional renewable natural gas facilities in the U.S., expanding its biogas portfolio. In September 2025, EnviTec Biogas commissioned a new biomethane plant in Germany to support renewable gas production for industrial and transportation applications.

Click to Read the Complete Insights & Report: https://straitsresearch.com/report/bioenergy-market

Future Outlook

The bioenergy market is expected to expand steadily through 2034 as renewable gas, biofuels, biomass-based power, and waste-to-energy technologies gain broader commercial use. Development of biomethane infrastructure and advanced biofuels is creating additional applications beyond conventional biomass power and heating.

Asia Pacific is expected to remain the fastest-growing regional market, while North America continues to hold a leading position. Greater utilization of agricultural residues, organic waste, used oils, and other biomass resources will support new bioenergy projects across transportation, power generation, heating, and renewable-gas applications.

About Straits Research

Straits Research is a global market intelligence and consulting company providing industry research, strategic insights, customized consulting, and business intelligence solutions across diverse markets and industries.