A roundtable on the prospects for exporting Ukrainian biomethane to Germany and the EU as a whole was recently held in Berlin. Below is a summary of the discussion based on an information note by Vitaliy Radchenko, UABIO Board Member and Managing Partner of CMS in Ukraine, together with UABIO’s analytical conclusions.
Key Takeaways from the Roundtable
Integration of Ukrainian Biomethane into the EU Market
One of the key unresolved issues is the registration of Ukrainian biomethane in the EU’s Union Database (UDB). The European Commission is working on a five-step integration plan. It will cover verification of volumes injected into Ukraine’s gas network, traceability of biomethane along the entire supply chain, as well as data accuracy and the prevention of double counting.
Some participants emphasised that Ukraine is already part of the integrated European gas network. Therefore, in their view, applying mass balancing to Ukrainian biomethane should not require any additional market access authorisation, and the EC should focus on proper accounting in line with RED III.
The representative of the European Commission did not share this position. She stressed that biomethane is a premium market that receives public support, and this support must be justified to consumers and taxpayers. Therefore, standards of data accuracy and reliability must be the same in Ukraine and in the EU. According to her, this is not excessive bureaucracy.
She also noted that there is no equivalence between the gas systems of Ukraine and the EU, so Ukraine cannot currently be considered part of the EU mass balancing system. At the same time, significant progress was made in 2025–2026, and the EC will soon prepare a checklist of specific steps for Ukraine. The representative expressed confidence that the issue will be resolved.
Participants also raised concerns about German customs rules, which, according to them, make it impossible to import Ukrainian biomethane into Germany. They underlined that these restrictions are national rather than EU-wide, so in theory they could be lifted without changes to EU legislation.
Main Obstacles to the Development and Financing of Ukrainian Projects
The EBRD representative reported that the bank has not yet signed a single biomethane project in Ukraine. The EBRD is currently working on two projects, which it hopes to sign next year, and is exploring six more opportunities at an early stage. The bank is also considering small-scale plants, as decentralised facilities are less vulnerable to drone strikes. Bankability is ensured by offtake and feedstock supply agreements.
In her view, Ukraine has strong positions in terms of feedstock, and the EBRD can help with the cost of financing (as an implementing partner of the EU’s Ukraine Investment Framework). However, offtake and pricing remain the most difficult challenges, as favourable prices can currently be obtained mainly in Europe.
A representative of one of the project developers reported that the company has built a portfolio of Ukrainian biomethane projects with a capacity of around 500 GWh, but none of them has been implemented yet. The main obstacle is the lack of long-term offtake agreements needed for project financing. Buyers need certainty as to whether Ukrainian biomethane can be counted towards regulatory obligations in Germany, as this determines the price they are willing to pay.
Pilot export transactions are already taking place, but some volumes for maritime transport are being sold at significant discounts. Such arrangements do not provide the revenue predictability needed to finance new capacity. Therefore, participants advised against targeting Ukrainian projects exclusively at the German transport sector and the THG quota scheme (greenhouse gas emission reduction quotas in transport). The building heating sector could become an alternative, depending on future regulatory requirements.
Market Analysis by the German-Ukrainian Energy Partnership
The German-Ukrainian Energy Partnership presented a business case analysis for Ukrainian biomethane. It is based on 15 interviews with producers, technology suppliers and experts, as well as data on feedstock costs, CAPEX, OPEX and export logistics. Based on the results, three business cases were developed and the cost of Ukrainian biomethane delivered to Germany was estimated:
- Case A (waste-based, pipeline): €64.1/MWh;
- Case B (manure-based, BioLNG): €118/MWh;
- Case C (mix of waste and manure, pipeline): €77.6/MWh.
The recommendations for Ukraine include ensuring full interoperability of the registry and mass balancing system with the UDB and strengthening data reliability and traceability, possibly through the establishment of an accreditation body. It is also recommended to simplify grid connection through a separate regulatory package and to keep biomethane production subsidy-free, while allowing targeted CAPEX support in combination with IFI programmes.
Germany and the EU are recommended to integrate Ukrainian volumes and sustainability data into the UDB and to officially confirm the interconnection of the gas transmission networks of Ukraine and the EU. As a transitional step, it is proposed to consider a temporary pilot import scheme with the transfer of Proofs of Sustainability via Nabisy.
Planned Changes to Green Gas Regulation in Germany
A representative of the German Federal Ministry of Agriculture, Food and Regional Identity (BMLEH) reported that a discussion of a new green gas quota scheme for building heating, involving industry associations and the Federal Ministry for Economic Affairs and Energy (BMWE), is scheduled for 16 October 2026. The mandatory share of green gases is to gradually increase to 100% by 2045.
For Ukrainian exporters, the key question is whether the final scheme will allow imported biomethane to be counted and what certification requirements will apply. This will determine the possibility of concluding long-term supply contracts for the German building sector.
UABIO’s Analytical Conclusions
- The key document of the coming weeks is the EC checklist for Ukraine. It will define the scope, sequence and timeline of the work.
- Bankability is blocked not by feedstock or CAPEX, but by offtake. Without recognition in the UDB and clarity on eligibility in Germany, there are no long-term offtake agreements and, consequently, no project financing. Tellingly, the EBRD has not signed a single biomethane project in Ukraine, and none of the projects in the developer’s portfolio (~500 GWh) has been implemented.
- The German green gas quota for buildings is the main “window” of 2026. Amendments to German legislation provide that the quota will gradually increase to 100% by 2045. The details will be set out in a separate law by 1 December 2026, and the quota itself will enter into force in 2028. If the law does not allow imported biomethane, the segment will de facto be closed to Ukraine.
- The delivered cost estimates (€64–78/MWh for the pipeline cases) indicate potential competitiveness, but the methodology has not been disclosed, so for now they are a weak argument in negotiations.
Ukrainian biomethane has a strong feedstock base and, according to preliminary estimates, is potentially price-competitive in Germany. However, as long as the volumes are not recognised in the UDB and buyers are not certain that Ukrainian biomethane will count towards German obligations, there will be neither long-term contracts nor project financing. That is why the coming months are critical: Ukraine needs to complete the steps set out in the EC checklist, and the German green gas quota law needs to allow imported biomethane to be counted. Success on both fronts could open up access for Ukrainian producers to the German building heating market.