What is Renewable Energy in Agriculture and Why Does It Matter?
Renewable energy in agriculture refers to the integration of energy generation systems such as biofuels, solar farms, wind energy, and biogas within agricultural operations. This model enables farms to utilize land, crop residues, and organic waste to produce clean energy while maintaining agricultural productivity.
This approach is increasingly relevant as it creates dual value. Farmers gain additional revenue streams through land leasing, biomass utilization, and energy partnerships, while contributing to decarbonization goals. Technologies such as agrivoltaics allow simultaneous crop cultivation and solar power generation, improving land-use efficiency.
The market is gaining traction globally as governments and private players push for sustainable farming and clean energy adoption. According to BIS Research, the global renewable energy in agriculture market was valued at $8,091.4 million in 2024 and is projected to reach $26,400.4 million by 2035, growing at a CAGR of 11.37%.
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What’s Driving Growth in the Renewable Energy in Agriculture Market?
Key Drivers:
• Growing demand for sustainable farming practices and low-carbon energy solutions
• Rising adoption of biofuels such as ethanol and biodiesel from agricultural waste
• Expansion of agrivoltaics and solar farm installations on agricultural land
• Government incentives, subsidies, and policy support for renewable integration
• Increasing collaboration between agribusinesses and energy companies
• Emergence of precision agriculture technologies for biomass aggregation and tracking
What Are the Challenges in the Renewable Energy in Agriculture Market?
Key Challenges:
• Complex contract structures between farmers and energy developers
• Volatility in biomass and feedstock pricing affecting biofuel economics
• Concerns regarding soil health and long-term land productivity
• High upfront investment for renewable infrastructure deployment
• Limited awareness and technical expertise among smallholder farmers
• Infrastructure and logistical challenges in biomass collection and processing
What is the Recent Development in Renewable Energy in Agriculture Market?
• 2024: Aemetis partnered with 49 dairy farms in California to develop an anaerobic digestion network expected to produce 550,000 MMBtu/year of renewable natural gas.
• 2024: VERBIO India and GAIL signed an MoU to develop compressed biogas plants using agricultural residues such as paddy straw and sugarcane waste.
• 2024: Vanguard Renewables collaborated with Oakmulgee Dairy Farm to build a digester facility generating 259,000 MMBtu/year of renewable natural gas.
• 2022: BTS Biogas partnered with A2A to develop biomethane plants across Italy, converting organic waste into renewable energy.
• 2017: Nexamp completed a 2.4 MW community solar project with Evergreen Farm, integrating solar generation with agricultural operations.
Market Segmentation: Where Are Growth Opportunities?
By Type of Farming Entity
• Co-operative Farms
• Single Ownership or Family Farms
• Corporation/Private Ownership
• Government Ownership
By Type of Farm
• Crop Farming
• Livestock
• Pasture and Forestry
• Others
By Energy Type
• Biofuels (Ethanol & Biodiesel)
• Biogas (Farm-Based Anaerobic Digestion)
• Agrivoltaics (Solar PV on Farmland)
• Wind Energy Systems on Farmland
• Other Renewable Practices (Geothermal, Small Hydro, etc.)
By Region
• North America
• Europe
• Asia-Pacific
• Rest-of-the-World
Analyst Perspective: What’s Next for Renewable Energy in Agriculture?
According to Principal Analyst at BIS Research: “The renewable energy in agriculture market is undergoing a structural shift as farms increasingly integrate energy generation into their core operations. Biofuels, solar farms, and biogas systems are enabling farms to diversify income while reducing environmental impact. Asia-Pacific, particularly China, is leading due to strong policy support and large-scale investments, while North America and Europe continue to expand adoption. Single ownership and family farms are expected to remain key contributors, especially in crop farming. Despite challenges such as pricing volatility and operational complexity, emerging models such as decentralized energy hubs and cooperative frameworks are expected to accelerate adoption and long-term scalability.”
FAQs About the Renewable Energy in Agriculture Market
What is the expected growth outlook?
The market is projected to grow from $8,091.4 million in 2024 to $26,400.4 million by 2035, driven by increasing adoption of sustainable energy practices in agriculture.
Who are the key leaders in this market?
Key players include Raízen, Vanguard Renewables Holdings, LLC, EnviTec Biogas AG, Aemetis, Inc., and BTS Biogas Srl.
Which energy solutions are most in demand?
Biofuels, particularly ethanol and biodiesel, along with agrivoltaics and biogas systems, are seeing strong adoption due to their ability to utilize agricultural waste and optimize land use.
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