Ensuring a Common Understanding of the Rules for the EU Chain of Custody & their Applicability to Third Countries

Today, the European biomethane market remains highly fragmented, with negligible cross-border trade and subsidy-driven growth at national level. Only a very small portion of biomethane is consumed outside its country of production, exposing the limits of the internal market. Limited liquidity prevents reliable price formation, which in turn prevents consumers from accessing the most efficiently produced biomethane and deters offtakers to enter into long-term agreements. Investments in new production are hindered, making the path to decarbonisation even more challenging. 

Market distortions stemming from the lack of harmonised certification systems and diverging interpretations of the mass balancing principle across Member States are common and undermine competition and level playing field among economic operators. 

We believe that the first step towards the integration of the European biomethane markets is to ensure a common understanding of how mass balancing operates, as well as to establish and accept universal rules for preserving the chain of custody. The forthcoming recast of Implementing Regulation (EU) 2022/996 on the rules to verify sustainability offers a timely opportunity to deliver this clarity and alignment across Member States.