Green Gas Support Scheme: What Changed in July 2025?
The Green Gas Support Scheme (GGSS) has become an important part of UK biogas subsidies and the drive to decarbonise the gas grid. Launched in late 2021, the GGSS provides tariff-based financial support for new anaerobic digestion (AD) biomethane plants that inject green gas into the grid. Participants receive guaranteed payments for 15 years based on the volume of biomethane produced, with funding raised via the Green Gas Levy on gas suppliers.
By mid-2025, however, industry stakeholders were asking: what’s new with the GGSS? In July 2025, a series of policy updates and guidance changes were introduced to strengthen the scheme’s impact and address early challenges. This article explores what changed in July 2025 and breaks down the strategic implications for AD developers and the biogas industry.
Why Updates Were Needed: Context up to 2025
In its first few years, the GGSS got off to a slower start than anticipated. In fact, in the scheme’s initial three years only one biomethane plant had begun injecting gas into the grid. This sluggish uptake was due to challenges such as securing feedstock supplies and lengthy project development times. Yet, a strong project pipeline was forming – several large-scale AD plants were due to come online by 2025, expected to produce enough green gas to heat 250,000 homes. To ensure these projects could benefit, the government undertook a mid-scheme review in 2023.
That review identified hurdles (e.g, delays in obtaining waste feedstocks and supply chain issues for equipment) and gathered industry feedback on how to refine the scheme. It led to key decisions, including extending the scheme timeline and tweaking certain rules, all of which became official by mid-2024 and were reflected in the July 2025 guidance update.
The overarching goals were to boost deployment of AD plants under the GGSS, provide investors more certainty, and ensure the scheme’s requirements were clear and achievable without undermining its environmental integrity.
Key Changes and Updates in July 2025
July 2025 brought significant updates to the Green Gas Support Scheme’s regulations and guidance. These changes have important implications for anyone planning or operating a biomethane project under the scheme. Below is a summary of the major policy changes and clarifications as of mid-2025:
Application Window Extended
The GGSS application deadline was extended by over two years – from the original 30 November 2025 to 31 March 2028. This extension, enacted via new regulations in June 2024, gives prospective AD projects extra time to get commissioned and apply for support. It was a direct response to industry feedback that more time was needed to line up feedstock contracts and construction for new plants.
Importantly, the extension aligns with the rollout of separate food waste collections by 2026 (in England), which will significantly boost the availability of organic waste feedstocks for AD. In short, biomethane developers now have until March 2028 to secure GGSS support, tapping into a growing supply of waste feedstock in the coming years.
Tariffs Unchanged
The government’s Annual Tariff Review 2025 concluded that no changes were needed to the subsidy levels. This means the GGSS tariff rates remained the same going into late 2025.
For reference, the tariffs stayed at Tier 1: 6.86 pence per kWh (for the first 60,000 MWh of biomethane injected per year), Tier 2: 4.26 p/kWh (next 40,000 MWh), and Tier 3: 3.98 p/kWh (production above 100,000 up to 250,000 MWh/year). These rates are indexed to inflation (CPI) annually each April. Keeping tariffs steady in 2025 indicates the government’s confidence that current levels strike a good balance – high enough to spur investment but not so high as to overpay for green gas. For project developers, this stability removes short-term uncertainty; business models can be built around the existing tariff structure.
It’s worth noting that no tariff degression automatic reduction was triggered in mid-2025, as projected scheme spending remained below the threshold that would require a 10% cut to tariffs. This suggests there is still budget headroom for new projects to come on stream without immediately eroding the subsidy rates.
Heat Pump Exemption for Thermal Energy
A notable technical change is the introduction of an exemption for renewable heat use in the biomethane production process. Previously, if an AD plant used any external heat (for instance, to maintain digester temperature or for biogas upgrading), that energy input was treated as a deduction in calculating eligible biomethane – especially if the heat came from fossil fuels. Following the 2023 review, the government removed the penalty for heat provided by eligible heat pumps. In other words, if your plant uses a heat pump (electric-driven) to generate heat for the AD or upgrading process, that heat is no longer counted against your biomethane output. Biomethane producers using heat pumps can now receive higher tariff payments because renewable-sourced heat won’t reduce their eligible gas volumes. This change incentivises the integration of low-carbon heating technology in AD facilities. (Fossil-derived heat, on the other hand, still triggers a deduction as before – so using biogas, biomass, or heat pumps for process heat is clearly advantageous.)
No Change to Waste Feedstock Requirement
The GGSS has always required at least 50% of the biogas feedstock to be waste or residue (rather than purpose-grown crops). Some in the industry wondered if this threshold might be raised or altered in 2025, but the government decided to maintain the 50% waste minimum. This continuity underscores the scheme’s ongoing emphasis on using genuine waste materials (like food waste, manures, slurries, agricultural residues) to achieve both greenhouse gas savings and a circular economy benefit. It’s good news for project developers that planned their feedstock mix around the 50% rule – there’s no new hurdle to clear. The review also left other eligibility rules unchanged (for example, digestate management obligations remain as originally set, and proposals to allow CHP-to-biomethane plant conversions were not adopted). So, the core criteria of the GGSS are steady: new AD plants, primarily waste-fed, injecting biomethane to grid.
Streamlined Application Process
Ofgem issued updated GGSS guidance (Version 2.2) on 7 July 2025, which clarified and in some cases simplified application requirements. One immediate relief for applicants is the removal of certain document submission requirements at the final registration stage. For example, the new guidance no longer mandates upfront evidence of all planning permissions, compliance with local/national laws, or confirmation of no public grants received as part of the initial registration application. These items were deleted from the checklist (Table 3 in the guidance) to reduce paperwork at the point of application. However, developers must note: this doesn’t mean you can proceed without planning permission or ignore legal compliance! The guidance simply streamlines the application by deferring some evidence. In fact, a new paragraph explicitly states that before Ofgem can grant full registration, you must have provided proof of planning, legal compliance, and no double funding as needed. In practice, this change aims to make the application process faster and less burdensome, while still holding producers accountable for meeting all underlying requirements. Be prepared to produce the removed documents upon request or at audit, even if they’re not required in the initial application upload.
Commissioning Deadlines and Grace Period
The July 2025 guidance also cleared up confusion about timing for project commissioning. It emphasises that once you secure a Tariff Guarantee (a preliminary approval locking in your tariff rate), you must commission your plant and submit your full application for registration within the allotted time. That timeline is either within the standard 182-day commissioning grace period or by the final scheme closure date of 31 March 2028, whichever comes sooner. In other words, the 6-month grace period to get up and running after your intended commissioning date cannot extend past the scheme’s ultimate end-date. This clarification is a warning against complacency: even with the extension, projects need to stay on schedule. Strategic tip: if you’re aiming for a Tariff Guarantee in late 2027, be mindful that you will have to commission by March 2028 regardless, as any grace period beyond that is void. Timely execution is key to securing your payments.
Metering and Data Reporting Requirements
Another improvement is monitoring and reporting, impacting both project design and daily operations. The updated guidance mandates metering all heat supplied to biogas production. This aligns with the heat pump exemption mentioned earlier—operators must fit meters to verify if heat comes from eligible sources. The guidance clarifies when heat can be excluded from biomethane output, specifically for eligible heat pumps and internal heat recovery. Ofgem also requires plants awaiting registration to collect and keep all operational data from day one. Earlier, some believed reporting began post-registration, but it’s now clear full records of biogas production, biomethane output, and feedstock usage are needed from the start for retroactive payment calculations.
Reinforced Sustainability Criteria
The GGSS includes strict sustainability rules on greenhouse gas emission savings and feedstock sourcing, reinforced in the July 2025 update. Only “sustainable biomethane” now qualifies for payments. Biomethane failing lifecycle GHG thresholds or feedstock land use criteria won’t be paid. Ofgem administers the scheme but isn’t an environmental regulator; compliance with all environmental laws remains participants’ responsibility. Producers must show ongoing compliance via evidence of GHG savings (including fugitive methane) and feedstock land criteria (e.g., no crops from recent deforestation). The guidance references DESNZ on GHG and methane leakage calculations, highlighting regulatory scrutiny. Key point: sustainability is an ongoing duty, not just an application formality. AD operators must rigorously track feedstock, energy, and emissions to ensure continued eligibility each quarter.
July 2025’s changes were less about overhauling the GGSS and more about fine-tuning and future-proofing it. The scheme’s fundamental structure, a multi-tier tariff paid over 15 years to waste-fed AD plants, remains intact.
The updates extend the runway for projects to participate, clarify the rules to reduce ambiguity, and introduce tweaks (like the heat pump credit) to encourage best practices. Next, we’ll explore what these changes mean for businesses and how stakeholders can capitalise on them.
Strategic Implications for AD Developers
For companies in the anaerobic digestion and biogas sector, the mid-2025 updates to the GGSS carry several strategic implications.
More Time to Plan and Build , But Don’t Delay
The extension of the scheme to 2028 is great news for developers who were worried about hitting the previous 2025 cutoff. It provides a much-needed time buffer to get projects financed, constructed, and commissioned. The alignment with expanded food waste collection in 2026 means more feedstock will become available, potentially supporting a new wave of projects.
With a final March 2028 deadline, the clock is still ticking. Use this extra time wisely: secure feedstock contracts (from local authorities’ food waste or farms), line up your technology suppliers (taking into account any lingering supply chain delays), and get your permitting sorted early. The 182-day commissioning grace period remains in effect, but as clarified, it won’t extend past the closure date – so aim to have your plant producing well before the last minute. Remember that tariff guarantees (TG) lock in your tariff rate but have validity windows; plan your TG application such that you can comfortably commission within its timeframe. In short, the sooner, the better – even with the extension, high demand later could mean a rush of projects vying for grid capacity and equipment. Early movers will benefit from full 15-year payment terms and avoid any bottlenecks if the industry suddenly accelerates.
Stable Tariffs Bolster Investor Confidence
The decision to keep tariffs unchanged in 2025 provides stability for business models. Investors and banks can be confident that the incentive levels (around 7 pence per kWh for Tier 1 production) remain as originally envisioned, at least through the next review cycle. This is crucial for project economics – those rates often make the difference in achieving a viable Internal Rate of Return for AD plants, given high upfront capital costs.
Additionally, no degression in mid-2025 means early projects didn’t cause a cut in tariffs. Looking ahead, keep an eye on the quarterly expenditure forecasts that DESNZ publishes. If industry uptake surges (which we hope it will), there is a mechanism to reduce tariffs by 10% if spending forecasts breach set thresholds. As of the July 2025 forecast, spending was below the trigger level – indicating the scheme can absorb more projects without trimming support. But if you anticipate a wave of new applications, it might be strategic to get your application in before any potential future degression is triggered (degrossions, if any, would be announced quarterly or via the annual review each September).
The current incentive is attractive and steady; use that to bolster your business case when negotiating financing or partnerships. Highlight the government’s commitment to maintain value-for-money tariffs that still robustly support deployment.
Integrate Renewable Heat to Maximise Revenues
The new heat pump exemption encourages AD operators to use renewable heat in their plant design. If you planned to use a biogas boiler, CHP, or grid gas for heating, consider switching to electric heat pumps or other renewable heating. Heat from eligible heat pumps isn’t counted as fossil energy, so your biomethane output stays fully eligible for GGSS payments.
For example, a plant using heat for drying digestate or warming digesters can now use large heat pumps without losing tariff payments. Although heat pumps have upfront and running electricity costs, the extra income from higher GGSS payments can cover these costs over time.
We recommend checking your numbers, as using heat pumps often improves returns by maximising GGSS revenue. Plus, heat pumps lower your carbon footprint and help meet emissions rules.
Streamlined Applications – Still Play by the Rules
The simplification of documentation at application is a welcome quality-of-life improvement for developers. It means less bureaucracy at the point of registration application – potentially speeding up the process of getting onto the scheme. But don’t misread this as a free pass. You still must have all the necessary permits and legal compliance in place; you just might not need to upload every piece of evidence immediately. Strategically, this change suggests Ofgem is trying to reduce administrative barriers, so take advantage of it by ensuring your application is complete and correct on first submission. Common delays in the past have included minor errors in paperwork or missing attachments, double-check everything before hitting submit. With fewer items required initially, there’s no excuse for not providing a “properly made application” (as the guidance calls it).
One critical requirement added to the list is a Fuel Measurement and Sampling (FMS) proposal at application. Make sure you prepare a solid FMS plan as this now needs to be part of your submission. In practice, a smoother application process means you can secure your place in the queue (and your tariff guarantee) faster. Keep organised records of your planning consent, any environmental permits as Ofgem can request these before final registration and a delay in producing them could still jeopardise your approval.
Embrace Data and Sustainability as Ongoing Duties
The emphasis on sustainability and reporting in the updated guidance reminds that participation in the GGSS is a long-term commitment, not just to produce biomethane, but to do so in an environmentally responsible and transparent way. Make data your ally. From day one, ensure all required information is recorded: biogas volumes, methane content, propane enrichment volumes (if any), meter readings (with timestamps) for gas, electricity, and heat, feedstock tonnages by type, etc. The new quarterly and annual submission tables act as a checklist for regular reporting. Setting up automated data logging and a robust monitoring plan will save headaches at quarterly deadlines. Sustainability documentation shouldn’t be an afterthought reserved for annual reports. If claiming a GHG emissions reduction, be prepared to back it up: keep records of energy inputs (fuel and electricity on site), feedstock transport distances, and methane leakage measurements if available. Performing an internal audit against the scheme’s GHG calculator every few months is advisable to ensure emissions remain under the threshold. Also, maintain files for each feedstock batch proving origin (e.g. waste transfer notes, sustainability declarations from suppliers) to meet land criteria and waste content rules.
The guidance now clearly links the FMS and GHG calculation methods – meaning your measurement approach should align with how emissions are counted. Non-compliance can lead to withheld payments or even exclusion from the scheme, which would devastate your project economics. On the flip side, those who proactively manage their sustainability performance will find the GGSS a reliable and predictable revenue source. Many AD operators are even going beyond compliance – for example, installing gas-tight digestate storage or flare systems to cut methane slip – both to improve GHG savings and to preempt any future tightening of scheme rules. The key point is: treat sustainability metrics as key performance indicators for your plant, on par with production output.
Look Ahead to Post-2028 and Wider Opportunities
With the scheme secured until 2028, you have a strong medium-term runway for project development. However, it’s wise to watch beyond that. The government plans a future biomethane policy framework post-GGSS, gathering evidence and “testing thinking” on long-term support, possibly through successor schemes, carbon market integration, or other means. Engage in these discussions via trade bodies like the Anaerobic Digestion and Bioresources Association (ADBA) to ensure your interests are heard.
In the short term, explore additional revenue streams: Renewable Transport Fuel Certificates (RTFCs) if biomethane fuels vehicles, or carbon credits if you can measure and sell emissions reductions. While GGSS offers the main subsidy, savvy operators combine values without breaching “no double public funding” rules, private carbon markets usually differ, but do seek advice.
The extended timeline and more available feedstock may encourage partnerships—local authorities might need AD solutions for food waste, or industrial sites could supply feedstock and take biogas for CHP. Capitalise on government support momentum. With recent high natural gas prices and energy security drives, biomethane has strong backing. As ADBA chair Chris Huhne notes, biogas could generate more energy than a nuclear plant by 2030 if supported properly.
Next Steps for GGSS
The Green Gas Support Scheme’s July 2025 updates underscore one thing: the UK is doubling down on green gas as a vital part of its net-zero strategy. The scheme’s extension to 2028, stable tariff rates, and refined rules are designed to boost investor confidence and accelerate project deployment.
For the AD and biogas industry, this is a clear signal to move full steam ahead – develop those projects, secure those waste feedstocks, and innovate in plant efficiency and sustainability. The policy changes are largely positive tweaks that make it easier to participate (streamlined applications) and more rewarding to adopt best practices (heat pump usage, etc.), all while holding firm on environmental standards.
As you plan or progress your biomethane projects, keep the following final takeaways in mind:
The window is open: With ~3 years added to the clock, there’s opportunity for new projects – but begin now to hit the 2028 deadline.
Do it right: Compliance (permitting, sustainability, reporting) is non-negotiable. Build it into your project DNA from day one.
Optimise for revenue and carbon: Little choices, like using a heat pump or improving methane capture, can pay dividends in both subsidy revenue and emissions performance.
Stay informed: Continue monitoring GGSS announcements (tariff reviews, budget notices) and engage with industry forums. Policy is evolving, and knowledge is power.
If you have questions about how to make the most of the GGSS or need guidance on developing a successful AD biogas project in the UK, consider reaching out for expert help.
At BIOCON Group, we specialise in end-to-end anaerobic digestion solutions, from navigating funding schemes and compliance to optimising plant operations. Contact our team for personalised advice and let us help you turn these policy updates into tangible business value. The green gas revolution is underway, and with the right strategy, your project can be a cornerstone of this sustainable future.
