Biomethane from biodegradable waste, produced as a local alternative to natural gas, is one of the key elements of the energy transition towards sustainability. However, its development within the EU is hampered by the lack of uniform rules for cross-border trade and different support systems in Member States. Countries such as Germany and the Netherlands dominate the European biomethane trade, while the Czech Republic is just getting started. However, a new biomethane support scheme being prepared by the Ministry of Industry and Trade, which is expected to come into force at the beginning of 2026, could help the country to develop.
Biomethane is considered one of the most promising forms of renewable energy due to its contribution to meeting climate and energy targets and reducing greenhouse gas emissions. However, its trade within the European Union is still problematic. “Each member country, for example, still applies different rules for issuing and recognising guarantees of origin,” points out Petr Voltr, head of EFG Commodities division, adding that “the underdeveloped cross-border market can also have a negative impact on the development of localised production in individual countries, which are facing insufficient demand.” This is the case in the Czech Republic, which, unlike other EU countries, does not yet have a standardised procedure for local operational support.
According to current EU data, only a small part of biomethane is consumed outside the country of production. This is precisely because trade of biomethane between countries is often accompanied by complex administration related to certification of emission savings and proving guarantees of origin. This process varies from state to state, which slows down trade. However, the Union Biofuels Database (UDB), which will link Member States’ national databases and make it easier to track cross-border transactions and report on national climate and energy targets, should make the situation clearer in the coming years.
An important barrier to cross-border trade of biomethane is the different forms of support and subsidies for its production in different European countries. For example, Germany and the Netherlands already introduced support for renewable energy in the 1990s and are now quite far along in their development, which is also reflected in the biomethane sector. These countries are thus supporting not only its domestic production but also its export. On the other hand, countries such as the Czech Republic and Slovakia are only just introducing new support schemes, which, if set up correctly, should make producers more competitive on the domestic and European markets.
“For the further development of the industry, it is essential not only to harmonise the rules of cross-border trade, but also to provide more support for domestic demand. The adoption of effective instruments for trade of biomethane, which will make the conditions for its producers more transparent, can then help in meeting the climate goals of individual countries and the development of modern energy,” explains Petr Voltr.
Will auctions for operational support help?
In the Czech Republic, the shortcomings of the poorly organised biomethane market and the low domestic demand for biomethane are to be made more effective by a new support scheme prepared by the Ministry of Industry and Trade. It should come into force from January 1, 2026 with an amendment to the law under the so-called LEX RES III package. It is built on the principle of three auctions, which logically follow and complement each other.
The first of these will choose a so-called mandatory gas purchaser, which will ensure guaranteed purchase of biomethane from producers at prices linked to the average spot price of natural gas in a given month.
The second will be for the operators of biomethane stations, who will determine the so-called reference auction price. This auction should represent the price at which a producer would be willing to produce biomethane and supply it to the gas grid in the long term. Participation in the auction and the subsequent payment of aid will be conditional on meeting sustainability and GHG savings criteria. The producer must also take into account that he will not be entitled to guarantees of origin if the aid is used.
The third auction, managed by the market operator (OTE, Inc.), will offer guarantees of origin for the biomethane it acquires from producers registered for operating support.
