As we previously reported, the first export of Ukrainian biomethane took place in early 2025. At the moment, exports to the EU are Ukraine’s only option for selling its biomethane, as it has to compete equally with natural gas in the domestic market. It means that for Ukraine, fostering biomethane export offers a strategic pathway to strengthening its economy, diversifying its energy markets, and contributing to regional energy independence.
Developing the local market, whose potential will long exceed the capacity of biomethane producers, is a top priority. Clearly, this goal can only be achieved after the end of the war with the Russian Federation.
Considering favourable conditions, biomethane production in Ukraine is anticipated to reach 250 mcm by 2027. This goal depends on the end of the military invasion of Ukraine, highlighting the critical importance of a peaceful environment for sustainable growth. Biomethane is projected to become a major export commodity in Ukraine’s trade with European countries. However, exports to Europe are also facing certain challenges.
As of mid‑2025, Ukrainian biomethane producers and traders are not yet permitted to register their biomethane volumes directly in the Union Database as third‑country economic operators. While the UDB has been operational for liquid renewable fuels and its gas module is being launched, formal integration for Ukrainian operators requires regulatory and technical arrangements that remain pending.
However, in the transitional phase, producers may temporarily export biomethane based on documentation confirming its sustainability – a sustainability certificate and Proof of Sustainability (PoS) – issued under one of the internationally recognized voluntary certification schemes.
According to Ukrainian legislation, export is restricted exclusively to the volumes of biomethane accumulated by the exporter in Ukrainian underground gas storage (UGS) facilities as of the end of the calendar month preceding the month of export. This restriction applies regardless of contract terms and reflects national energy security policy objectives. Therefore, biomethane intended for export must be injected and stored in UGS facility prior to the start of the export month. Exporters are able to verify storage volumes through official acts issued by the Underground Gas Storage Operator of Ukraine (Ukrtransgaz).
Compliance with this requirement is a mandatory condition for customs clearance, and any attempt to export pipeline biomethane outside this framework may result in refusal to allow biomethane to cross the customs border of Ukraine.
The provision of biomethane transportation services through the gas transmission and distribution systems and gas storage in USG facilities, carried out on Ukraine’s territory by VAT-paying Ukrainian residents, is subject to VAT at a rate of 20%.
The sale of biomethane by a Ukrainian resident to a non-resident (e.g., an EU resident company) is subject to VAT at a rate of 0%, provided that the biomethane is exported outside Ukraine’s customs territory under the customs regime of export, duty-free trade, or free customs zone. On the other hand, the legislation establishes that, except for exports to member states of the Energy Community, gas exports (including biomethane) are subject to a duty of 35 per cent of its customs value . It means that exports without the imposition of export duties may be carried out exclusively to countries of the Energy Community, which do not include European countries such as Switzerland, Great Britain, and a number of other potential buyers.
Therefore, in 2025, the draft Law on Amendments to Certain Legislative Acts of Ukraine regarding the simplification of exports of Ukrainian-produced biomethane to global markets was registered. The draft legislation proposes to exempt biomethane from export duties, thereby facilitating its cross-border transmission and supporting Ukraine’s integration into the European renewable gas market.
