Biomethane as a Renewable Commodity for Australian Business
Biomethane has always been described as a fuel — a renewable, drop-in replacement for fossil natural gas, chemically identical and usable in the same pipes, burners and equipment with no modification. But over the past two years something more significant has happened in Australia: biomethane has started to become a commodity. A growing stack of government-backed certificate schemes now allows its renewable value to be measured, verified and sold separately from the gas itself. For Australian businesses trying to decarbonise, and for the producers who supply them, that changes how the whole market works.
Here's a plain-English guide to the schemes that matter, what they do, how they're priced and used, and what it means for AWE.
## The idea: separating the "green" from the gas
When renewable gas enters a shared gas network, it physically mixes with fossil gas — there is no way to route a specific molecule to a specific customer. Certificate schemes solve this by separating the renewable value from the physical gas. For each unit of certified renewable gas a producer makes, a digital certificate is created; a business can then buy and "retire" that certificate to verifiably claim the renewable benefit. Crucially, the same logic also covers renewable gas supplied directly to a local customer or used on site — the certificate tracks the renewable attribute regardless of how the gas is delivered. It is the model that built Australia's renewable electricity market, and one certificate generally represents one gigajoule (GJ) of renewable gas.
There are now several schemes — one national and voluntary, one national and government-run, and several emerging at state level.
## RGGOs — the route available today (GreenPower, national, voluntary)
The scheme operating right now is GreenPower's Renewable Gas Certification, which issues Renewable Gas Guarantee of Origin (RGGO) certificates. GreenPower is a government program, and the certification is national and voluntary: it certifies biogas, biomethane and renewable hydrogen, and lets commercial and industrial gas users match their gas use with certified renewable gas (Clean Energy Regulator's GreenPower program). Importantly, the scheme covers renewable gas supplied directly to a local customer or used behind the meter as well as gas injected into a network — so it is not limited to grid-connected producers. Australia's first registered facility was Jemena's Malabar Biomethane plant in NSW (NSW Government), and the Australian Financial Markets Association has published a standard RGGO trading contract, a sign the market is maturing.
On pricing: because RGGOs trade in a young, voluntary market, prices are contract-based rather than transparently quoted. For context, comparable green-gas certificate markets overseas give a sense of direction — the UK has run a green gas certification scheme for years, and in Denmark a certificate framework helped biomethane grow to roughly 40% of national gas supply by 2025 (APGA).
The Guarantee of Origin scheme — the national framework being built out (federal, Clean Energy Regulator)
The federal Guarantee of Origin (GO) scheme launched in November 2025 under the Future Made in Australia (Guarantee of Origin) Act 2024, administered by the Clean Energy Regulator. It has two arms: the Renewable Electricity Guarantee of Origin (REGO) for electricity, and the Product Guarantee of Origin (PGO), which records where a product was made and its lifecycle emissions intensity (Clean Energy Regulator). Importantly, the PGO currently certifies only hydrogen made by electrolysis — biomethane is not yet covered. It is, however, a priority product for inclusion: the government ran a public consultation on extending the scheme to biogas and biomethane from anaerobic digestion, which closed in April 2026, and biomethane is being written into the scheme's Methodology Determination through 2026 (DCCEEW). From 2025–26, businesses reporting under the National Greenhouse and Energy Reporting scheme can already claim renewable gas use through PGO certificates. The GO scheme is designed as the enduring national framework that the voluntary RGGO pilot is intended to eventually transition into.
## State schemes — where compliance-style demand is being created
Alongside the national frameworks, states are building their own mechanisms — and this is where genuine, mandated demand is starting to form.
New South Wales — Renewable Fuel Scheme (RFCs). The NSW Renewable Fuel Scheme, administered by IPART, is a compliance-style certificate scheme: producers create one Renewable Fuel Certificate (RFC) per gigajoule of renewable fuel, and liable parties (gas retailers and large gas users) must buy and surrender certificates to meet a target or pay a penalty (IPART; NSW Climate and Energy Action). The scheme starts with green hydrogen from 1 January 2027, and NSW has committed to expand it to biomethane from 2028, with a combined target growing to 8 PJ by 2038 and a shortfall penalty of $10.50/GJ — a figure that effectively underpins what a certificate is worth. NSW backed this with a Renewable Fuel Strategy and up to $170 million in funding, including $40 million aimed specifically at biomethane production.
Victoria — Gas Substitution Roadmap and a proposed Renewable Gas scheme. In December 2024 the Victorian Government released a Renewable Gas Directions Paper under its Gas Substitution Roadmap (DEECA), proposing a Victorian renewable gas scheme — including a "Renewable Gas Guarantee" requiring gas retailers to source a share of supply from renewable gas for industrial customers — with a certificate scheme proposed to begin in 2027 and a target of 4.5 PJ of renewable gas to industry by 2035 (around 6% of current industrial gas use). The government's formal response is being finalised in 2026, so the Victorian scheme is still in development rather than legislated. Victoria is also actively pushing for a single national renewable gas scheme through the Energy and Climate Change Ministerial Council.
## How the pieces fit — and what it means for AWE
AWE's Australian project is located in the Wentworth–Mildura region of the Murray–Darling — an area straddling the NSW–Victoria border, which keeps both states' emerging schemes in view alongside the national frameworks. The RGGO scheme offers a route to certify the renewable value of biomethane today; the federal GO scheme is adding a durable national biomethane certificate through 2026; Victoria's proposed scheme would create state-level demand from 2027; and the NSW Renewable Fuel Scheme shows where mandated, compliance-driven demand is heading. A project on that border sits within reach of all of them.
Two points shape how AWE is likely to engage. First, AWE's model is built around producing renewable gas and products locally, for local and regional use — so at least initially, AWE has no specific plan to inject biomethane into the gas transmission grid. Second, the certification frameworks don't require it to: the RGGO scheme already accommodates renewable gas supplied directly to local customers or used behind the meter, and the federal PGO is a product certificate that records how a product was made and its emissions intensity rather than how it is delivered. That means the renewable value of AWE's biomethane could still be certified and recognised even where the gas is supplied directly to a nearby industrial user rather than fed into a pipeline.
The practical result is that the renewable gas AWE's planned facilities are designed to produce wouldn't need to compete with fossil gas on price alone. Its certified renewable attributes could be recognised through these schemes — giving Australian businesses, particularly the regional manufacturers and hard-to-electrify industries near AWE's projects, a verified, locally produced way to cut the emissions from their gas use. As these frameworks mature, AWE intends to build certification in from the design stage rather than bolt it on later, so the full value of diverting regional organic waste into renewable gas can be captured and passed through to the local industries and communities AWE works with.
The direction of travel is unmistakable. Two years ago, Australia had no formal way to certify renewable gas. Today it has one operating scheme, a national framework being extended, and two states building their own. Biomethane is becoming a genuine renewable commodity for Australian business — and AWE's pipeline is being developed to meet that market as it forms.
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