Manure biomethane and THG prices climb following German RED III draft proposal

European biomethane and German THG biofuel tickets continued to post strong gains in the wake of Germany's recently released draft RED (Renewable Energy Directive) III proposal on June 19.

With higher GHG targets in 2026 and the removal of double-counting incentives, THG and unsubsidized manure biomethane prices showed persistent gains towards the end of the week.

By the June 25 close, Platts-assessed 2025 unsubsidized certified Netherlands manure climbed Eur1.25/MWh to Eur57.575/MWh from lows of Eur56.325/MWh during the week, with unsubsidized certified Denmark manure showing similar gains, rising to Eur57.50/MWh from an intra-week low of Eur56.25/MWh.

Meanwhile, 2025 THG-Advanced double-counting spiked after the announcement on June 19 to reach Eur305.50/mtCO2e by June 26 after starting the week at Eur270.00/mtCO2e, while 2025 THG-Other was up from Eur126.75/mtCO2e on June 19 to reach Eur152.75/mtCO2e on June 25.

Prices for 2026 THG-Other also rallied significantly, rising approximately 55% to Eur217/mtCO2e on June 20 compared to the previous week; this then rose by an additional 19.8% to Eur260/mtCO2e on June 23.

More biomethane needed; prices historically low

Biomethane market sources said that buying interest in -100g CO2e/MJ manure had increased significantly during the week on the expectation that more biomethane volumes would be needed in the future due to the removal of double-counting.

With double-counting no longer a feature, market participants expected that more biomethane would be needed to meet obligations.

Sources added that historically low prices for manure also helped support buying appetite.

"People might be buying to buy early while prices are still low, before the changes get implemented," said a trader in Europe.

"The lack of clarity means that buyers are hedging their bets, thinking that prices are going to go up," said another Europe-based trading source. "So it makes sense to buy it when it's cheap now."

THG market rallies on higher expected demand

The release of Germany's draft proposal had a bullish impact on the THG market, and the wider biofuels market,(opens in a new tab) as the removal of double-counting incentives alongside the lack of carryover tickets from 2025 to 2026 and higher GHG obligation targets, would mean increased demand for THG for obligated parties to meet their mandates.

"Prices for quota need to move up even more, you can't fulfil your target through blending [physical biofuels], it's not possible, you need a lot more quota," one source said.

If passed into law, the removal of double-counting incentives would mean the THG-Advanced double-counting ticket type will be defunct.

Sources indicated that biomethane would then generate the THG-Other ticket type, also known within the industry as No Cap quota, reflecting uncapped renewable energy.

"Biomethane will be no cap... everything that was GDC (German double-counting) before will become no cap," another source said.

"All former GDC will produce gigajoule, and gigajoule might drop in value," he added, referring to the advanced sub-target quota filled via the THG-Advanced single counting ticket type, measured in GJ.

Meanwhile, concerns of increased competition for physical biofuels, which tickets are generated from, are also supporting sentiment in the Dutch HBE tickets market.

Platts is a part of S&P Global Commodity Insights.