A sector that has moved from niche to infrastructure
In 2018 there were seven biomethane plants connected to the grid in Italy. By June 2026 there were 176 in operation, producing around 1 billion standard cubic metres (Smc) a year, roughly 1.6% of national gas demand. The result was driven by the incentive schemes of 2018 and 2022. The NRRP (PNRR) funds already awarded amounted to around EUR 2.13 billion out of a budget of EUR 2.24 billion.
Why European funds are looking at Italy
According to the European Biogas Association, planned investment in Europe has reached EUR 36 billion (+28% on the previous edition), and Italy ranks second after Denmark with around EUR 4 billion. Incentives do not explain everything. Italy benefits from one of the largest agri-food supply chains in Europe, which supplies manure and by-products, a dense gas network ready to receive biomethane, and fifteen years of experience in agricultural biogas. Many projects also stem from the conversion of existing plants, and therefore have shorter lead times.
What equity capital is doing
Recent transactions show that biomethane is being treated as an infrastructure asset class.
- Pan-European funds: Asterion has committed EUR 1.5 billion to the ABIO platform, of which EUR 800 million is equity. The European Investment Fund has subscribed EUR 200 million in Copenhagen Infrastructure Partners’ second bioenergy fund, which aims to raise EUR 1.5 billion.
- Transactions in Italy: in September FIEE SGR acquired a majority stake in Biomethan Holding with a commitment of EUR 42 million, starting from six plants with a further 17 projects under development. Sosteneo (Generali Investments) purchased four agricultural projects in Lombardy, completing the investments of its first fund.
- Returns: according to a McKinsey analysis, the shift to industrial models with portfolios of plants and integrated logistics could raise returns from the current 8-12% IRR to over 20%. The figure is taken from the public summary of the study and should be verified against the original report.
From the single plant to the value chain
Value is shifting along the chain. Biogenic CO2, bio-LNG for heavy-duty transport, digestate as a fertiliser and long-term supply contracts with industries seeking to reduce their carbon footprint are increasingly important. For an equity investor this means margins that are less tied to the incentive tariff and more to the ability to integrate activities.
The post-NRRP bottleneck
According to the Politecnico report, the main obstacles are complex permitting procedures, grid connection times, sustainable biomass supply and, above all, the lack of a stable regulatory framework beyond the current incentives. The risk is a gap between expected production and the 2030 PNIEC (National Integrated Energy and Climate Plan) targets. Around 90% of the 2025-2026 investment is already under construction, so the question for investors is how much capital will arrive afterwards, when public support is reduced.
Sources
- Perché il biometano italiano attira investimenti europei – Energia Oltre
- Biometano, come arrivare a rendimenti superiori al 20% – Staffetta Quotidiana
- Asterion to invest €1.5 bn into European biomethane
- EIF commits €200 million to Copenhagen Infrastructure Partners
- FIEE SGR acquisisce la maggioranza di Biomethan Holding – Energia&Mercato
- Sosteneo, 4 progetti biometano in Lombardia – Il Giornale d’Italia
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