The long-term renewable natural gas (RNG) offtake market is regaining momentum, supported by a strengthening regulatory environment and growing activity in the voluntary market.
The RNG market faced challenges in late 2024. Uncertainty loomed over renewable energy markets — including RNG — as a new administration prepared to take office. Adding to the volatility, the EPA reduced 2024 compliance commitments for obligated parties under the Renewable Fuel Standard (RFS).
Following a period of slower activity in late 2024 - driven by broader uncertainty across renewable energy markets - the outlook for RNG is now steadily improving. Policy adjustments, including changes to Renewable Fuel Standard (RFS) compliance targets, initially contributed to market volatility. However, these challenges have paved the way for renewed focus and more resilient foundations for growth.
Despite these headwinds, several positive developments signaled long-term growth for RNG and the broader biofuels industry. Notably, the U.S. Treasury Department released long-awaited guidance on the 45Z tax credit for clean transportation fuel producers. This incentive is expected to provide an economic boost to project developers and encourage new investments in the sector. Meanwhile, utilities in several states continue to purchase substantial volumes of RNG on the voluntary market, further reinforcing demand.
As 2025 began, market participants eagerly awaited clarity on the Trump administration’s stance on RNG. Despite its strong focus on fossil fuels, the administration has shown signs of openness to RNG, particularly as part of its approach to biofuels and energy independence.
Amid these uncertainties, the price of the D3 RINs has remained relatively stable at around $2.50. Encouragingly, EPA Administrator Lee Zeldin has pledged to set timely targets for future renewable volume obligations (RVOs), a key driver of the RIN market demand. This commitment could bring more long-term stability to the market. Although natural gas prices play a smaller role in RNG values, they remain an important consideration. After reaching record lows in 2024, prices have rebounded to more typical levels due to colder winter months and increased inventory withdrawals.
Meanwhile, the RNG industry continues to grow rapidly. According to the American Biogas Council, 125 new biogas projects became operational in 2024, with 95% of these being biogas-to-RNG facilities.
RNG production is supported by the growing demand from voluntary buyers, transportation fuel markets, and the establishment of state specific procurement programs. In addition to these domestic markets, the demand for RNG in foreign markets, like Canada and Europe, continues to grow. These emerging markets are expected to help support stable RNG pricing in the future.
RNG represents the majority of new biogas projects added in 2024, according to the American Biogas Council.
At a glance
Strengthening Fundamentals for RNG Growth
Clearer policy frameworks and stable market signals—such as D3 RIN prices around $2.50—are reinforcing confidence and improving long‑term visibility for RNG development.
A Supportive Environment for Investment
Key incentives like the 45Z tax credit and sustained demand from utilities and transportation markets continue to support the expansion of low‑carbon fuel production.
Rapid Industry Expansion and Global Demand
The U.S. RNG sector is growing quickly, with a strong pipeline of new biogas‑to‑RNG projects, complemented by rising demand from international markets such as Canada and Europe, supporting long‑term market stability.
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