How European Pharma Can Cut Scope 1 Emissions with Biomethane
Learn why pharma companies should rely on biomethane as a scalable, credible, and readily available low-carbon solution to address their scope 1 footprint.
Procure ISCC-certified biomethane today
Despite significant decarbonisation progress, the European healthcare and pharmaceutical sectors face a lingering challenge. Science-based targets are being set, renewable electricity deals are being signed, and sustainability reports are growing thicker every year. But most organisations have yet to face the elephant in the room: fossil gas. It remains a stubborn source of emissions, used to heat manufacturing facilities, sterilise cleanrooms, produce steam for injection systems, and power combined heat and power plants across manufacturing sites.
This is the scope 1 problem in the healthcare industry, and sustainability leaders and energy procurement managers operating in Europe today can no longer afford to ignore it.
Why scope 1 is a critical decarbonisation focus
Progress on scope 2 emissions (purchased electricity) has been significant, driven by efficiency measures, renewable power purchase agreements (PPAs), and on-site power installations. However, scope 1 emissions from stationary combustion are harder to eliminate through electrification alone. Pharmaceutical manufacturing, in particular, relies on high-temperature heat processes, such as steam sterilisation, solvent recovery, and fermentation, where replacing a gas boiler with an electric alternative is not always technically feasible or economically practical in the near term.
Historically, many companies managed scope 1 and 2 decarbonisation as a single journey, often under a combined SBTi target. In practice, this meant that rapid progress on renewable electricity often masked slower action on direct fuel use. The latest draft of the SBTi Corporate Net-Zero Standard (2.0) proposes a clearer separation of scope 1 and scope 2 targets, signalling that direct, on-site emissions will face increased scrutiny, reinforcing scope 1 as the next critical area of decarbonisation focus.
Growing regulatory pressure
Regulatory pressure is intensifying. The EU’s Corporate Sustainability Reporting Directive (CSRD) has transformed sustainability disclosure from a voluntary exercise into a mandatory, audited obligation. At the same time, the EU ETS2, set to be fully operational by 2028, will introduce a carbon price on fuel suppliers. These costs will inevitably be passed down to customers in sectors not previously covered by ETS. For healthcare and pharma companies, the cost of inaction on scope 1 emissions is rising financially, reputationally, and regulatorily.
Biomethane: A credible solution for pharma, available now
Biomethane, a renewable gas produced from organic waste streams and agricultural residues through anaerobic digestion, offers a unique advantage in the decarbonisation toolkit: it requires no infrastructure changes. Once upgraded and injected into the existing gas grid, it is chemically identical to natural gas.
Here’s why biomethane is a practical, near-term solution for European pharma:
Under the EU ETS2 and the European Sustainability Reporting Standards (ESRS), certified biomethane that meets the required quality and sustainability criteria is recognised as having substantially lower lifecycle emissions than fossil natural gas, and in some cases may be treated as carbon neutral. Every megawatt-hour (MWh) of certified biomethane flowing through an existing gas connection displaces a MWh of fossil gas in a company’s energy mix.
Procurement of biomethane via energy attribute certificates (EACs), or through physical or virtual biomethane purchase agreements (BPAs or GPAS), can contribute to a more robust, auditable reporting of scope 1 emissions, provided that companies apply methodologies consistent with current credible market frameworks, while recognising that detailed guidance from the GHG Protocol and SBTi on biomethane certificates is still evolving
In addition to its emissions benefits, biomethane procurement can help manage energy- and carbon‑related cost risks. Long‑term biomethane contracts and associated certificates can help organisations hedge against potential volatility in natural gas prices and CO₂‑related compliance costs, while supporting a more resilient energy supply system built on circular economy principles
Another important development is RED III, transposed across EU Member States by May 2025. introduces stricter sustainability criteria and enhanced traceability standards for biomethane, increasing the environmental integrity and credibility of certified supply. Consequently, compliance with RED III-aligned certification schemes such as ISCC and REDcert is now a market standard.
The supply hurdle: growing but still limited
While the market is growing rapidly, supply remains tight across Europe. According to the European Biogas Association’s 2025 Statistical Report, Europe now has an installed biomethane production capacity of 7 billion cubic metres (bcm) per year across 1,620 facilities – a 9% increase year-on-year – with €28.4 billion in private investment already committed to further expansion by 2030. Yet this represents only a fraction of what is needed to reach the EU’s REPowerEU plan target of 35 bcm of annual biomethane production by 2030.
For pharma sustainability leaders and energy procurement managers, the message is clear: biomethane is a credible decarbonisation solution that is already available today, uses existing gas infrastructure, and can directly displace fossil natural gas in many thermal and heat applications. But because volumes remain scarce relative to projected demand, acting early is vital. It allows pharmaceutical companies to secure suitable contracts, gain experience with the instrument, and begin reducing scope 1 emissions now.
Procure ISCC-certified biomethane certificates today
How to get started
The window for structured, strategic action is open. Here’s our four-step approach:
Quantify your natural gas baseline
Before you can set a credible reduction pathway, you need a complete picture of your scope 1 emissions from gas combustion, mapped by site and process. This is the foundation of any credible biomethane strategy.
Assess whether biomethane fits your operations
Not all facilities are the same. A hospital network may have different procurement needs than an API manufacturer. The key variables are volume, feedstock preference, contract structure, geographic availability, and term length.
Evaluate contract structures carefully
Options range from unbundled biomethane EAC purchases through to long-term physical gas purchase agreements that provide price certainty and deeper environmental additionality. Each structure carries different implications for claim quality, cost, and reporting.
Align with RED III compliance from the outset
Ensure any biomethane you procure is certified under a RED III-compliant scheme. This is critical not only for regulatory compliance but also for the credibility of claims under CSRD and evolving guidance like SBTi.
Work with a climate partner
With the right partner, pharma companies can navigate certification, contracting, and reporting from start to finish and integrate biomethane into a broader, science‑aligned decarbonisation strategy. If your organisation is ready to address the scope 1 gap, we are ready to help.
