Australia Bio LPG Market Size, Share and Forecast Trends - Growth Analysis and Outlook Report (2026-2035)

Key Market Trends and Insights

• The Australian Capital Territory dominated the market in 2025 and is projected to grow at a CAGR of 33.4% over the forecast period.
• By feedstock, residual/waste is expected to grow at a CAGR of 33.2% over the forecast period.
• By end use, the commercial category is projected to witness a CAGR of 32.8% over the forecast period.

Market Size & Forecast

• Market Size in 2025: AUD 11.16 million
• Projected Market Size in 2035: AUD 151.50 million
• CAGR from 2026 to 2035: 29.80%
• Fastest-Growing Regional Market: Australian Capital Territory

The Australia bio LPG market is also picking up pace due to the affordability of switching from conventional LPG, and homes and businesses can decarbonize without replacing their appliances. Adoption is driven by regional energy security, with bio-LPG functioning as a stable substitute during intermittent electricity supply or restricted grid accessibility. All these have collectively turned bio-LPG into a viable low-carbon energy source that meets a wide variety of residential and commercial energy requirements.

Strategic partnerships in the Australia bio LPG market allow energy companies to exchange experience, infrastructure, and supply networks, which mitigate risks in new ventures of renewable fuel. At the same time, the technical viability and commercial viability of bio-LPG are proven with the help of proof-of-concept projects that will help investors, regulators, and purchasers gain confidence. This collaboration strategy increases market credibility, investment appeal, and the transition to pilot projects towards large-scale manufacturing.

Furthermore, coupling collaborative networks with demonstrative projects will allow industry partners to effectively grow supply chains, maximize feedstock use, and provide renewable LPG to residential, industrial, and transportation sectors without interruption, which is propelling the Australia bio LPG market expansion. For instance, in November 2025, Viva Energy and Origin Energy signed a Memorandum of Understanding (MOU) to create the bio-LPG production proof-of-concept in the Geelong refinery owned by Viva to turn locally sourced used cooking oil into renewable LPG to supply to the Origin retail network.

Recent Developments

October 2025 - XCF Global & New Rise Australia Expanded Renewable Fuel Facilities

XCF Global signed a binding term sheet with New Rise Australia in order to install modular renewable fuel production plants in Australia and aims at a minimum of three SAF plants. This growth will ensure that there is more capacity in the production of low-carbon liquid fuels in the country and that infrastructure is well prepared. The initiative, through its reinforcement of the renewable fuels ecosystem and feedstock demand, indirectly promotes the expansion and incorporation of bio-LPG into larger energy changeovers.

March 2025 - Vast Secured AUD 180 Million for South Australia Clean Energy & Green Fuels

Vast Renewables secured AUD 180 million from the ARENA to construct a utility-scale clean energy development at Port Augusta, which will supply green fuel production. This funding is speeding up the grid-connected generation of renewables, which will allow for the manufacture of low-carbon fuels. The growing supply of renewable power and renewable feedstocks will enhance the Australian renewable liquid fuel foundation, which indirectly supports the Australia bio LPG market.

November 2024 - Vast Received USD 30 Million ARENA Funding for Green Technology

Vast Renewables secured USD 30 million from ARENA to increase the capacity of its clean technology and green fuels. This capital sustains next-generation concentrated solar thermal power systems, which form the basis of green methanol and renewable aviation fuel programs. The development of renewable liquid fuels and energy security establishes a better marketplace for low-carbon fuels such as bio-LPG because of similar feedstock, technology, and policy synergies.

June 2024 - Vast & Mabanaft Advanced Green Methanol Project at Port Augusta

Vast Renewables and Mabanaft entered into a Joint Development Agreement with the aim of advancing the Solar Methanol 1 project in South Australia, where 7,500 tons of green methanol is to be produced annually. This partnership promotes liquid fuel capacity founded on renewable energy, which assists in the decarbonization of transport and industry. Extended chains of renewable fuel can facilitate biomass and waste feedstock needs, which indirectly increases the future opportunities in the Australia bio LPG market.

Key Drivers and Trends

Infrastructure Expansion to Process Bio Feedstocks

Renewable fuels such as bio-LPG require upgrading refinery infrastructure that is designed to accommodate bio-feedstocks. Improved processing capacity allows for reducing waste oils, fats, and other renewable feeds into less carbon-intensive products, guaranteeing domestic security. Through capacity-building refiners, firms operating in the Australia bio LPG market are able to cut the level of imports and achieve sustainability targets. For instance, in May 2023, Viva Energy stated that it would process bio-feedstocks at its Geelong refinery, which would be used to support renewable LPG paths.

Trial Deployments of Lower Carbon Fuel Products

Demonstrative trials provide proof of renewable fuel's performance and boost trust in the Australia bio LPG market. Operational reliability is encouraged through supply chain preparedness due to real-world testing, and this makes the technology worth investing in and adopting. For instance, in April 2025, Viva Energy did the first commercial trial of marine biofuel in Australia on the Royal Caribbean Celebrity Edge with an 80/20 biofuel mixture, demonstrating the utility of renewable fuels and the infrastructure capacity building of bio-LPG.

Renewable Diesel Product Launches Bolstering Bio Feedstock Economy

Bringing renewable diesel products enhances the demand for bio-feedstocks and indirectly promotes bio-LPG production as a by-product. Renewable diesel facilitates economies of scale and allows extensive use of low-carbon fuels. For instance, in February 2024, Viva Energy introduced 100% renewable diesel in collaboration with Cleanaway to provide HVO to waste-collection fleets to enhance the renewable-fuel ecosystem that supports the Australia bio LPG market dynamics.

Circular Economy Initiatives Increasing Valuable Feedstock Streams

The projects under the circular economy transform waste materials into renewable feedstocks and thereby contribute to the production of low-carbon fuels such as bio-LPG. These programs guarantee stability in supply, lower expenditures, and increase sustainability qualifications, which promote market confidence. Using the example of March 2025, in a project with Klean Industries, Viva Energy engaged in a tire-recycling project to generate bio-genic pyrolysis oil to be converted into lower-carbon fuels in Geelong, which would increase the availability of renewable feedstock.

Long-Term Refinery Transformation Supporting Renewable Fuel Layers

The conversion of old refineries to renewable fuel centers enhances the bio-LPG production infrastructure foundation, further propelling the Australia bio LPG market development. Multi-product plants maximize feedstock utilization and generate high-quality results of low-carbon fuels to maintain market preparedness in the long term. For instance, the Geelong refinery of Viva Energy has been modernized to process renewable feeds and generate sustainable fuels since 2023 to support the structural support of bio-LPG along with renewable diesel and SAF.

Australia Bio LPG Market Share

By feedstock, sugar contributes significantly to the market growth through renewable energy and biofuel potential

The sugar feedstock industry is driving expansion in the Australia bio LPG market due to its potential for both renewable fuel generation and electricity production. Bio-LPG and sustainable aviation fuel can be made from sugarcane biomass, molasses, and juice and offer alternatives that are low-carbon in the industrial, transportation, and energy sectors. In November 2025, the Australian Sugar Manufacturers requested a USD 40 million package investment to form bioenergy precincts in Queensland, pointing to the ability of the sector to generate regional employment, reinforce energy security, and allow a circular bioeconomy.

The oil feedstock category of the Australia bio LPG market is driven by the increasing demand for renewable diesel and sustainable aviation fuel, with key energy producers trying to find low-carbon options for conventional fossil fuels. Production costs, feedstock availability, and favorable government policies all have an impact on strategic investment in oil-based biofuel plants. The fact that BP cancelled its USD 1 billion Kwinana Renewable Fuels project in Western Australia in February 2025 demonstrates the direct impact of economic and regulatory uncertainty on the development and usage of oil-based biofuels.

By end-use, residential category shows notable growth driven by Bio-LPG adoption and low-emission energy solutions

The residential segment is a key driver fueling the Australia bio LPG market revenue as households seeks low-emission, cost-effective energy alternatives for cooking, heating, and hot water. Net zero bioLPG, available from 2025–26, and renewable synthetic LPG (rLPG), projected by the mid-2030s, offer one-for-one replacements for conventional LPG without major infrastructure changes. This allows homeowners to decarbonize efficiently while maintaining reliable energy access.

The commercial interest in the Australia bio LPG market is increasing due to the need of the business environment to seek low-cost and low-emission energy options that comply with objectives in the areas of sustainability and reliability in business operations. Bio LPG and renewable LPG offer useful drop-in replacements to use instead of conventional LPG, with no additional infrastructure or upgrade of appliances needed, and are suitable for retail and hospitality as well as light industrial consumers. The sector advocates for these benefits, and Gas Energy Australia's contribution focuses on net zero bioLPG availability between 2025 and 2026, as well as its utility to both homes and enterprises.

Australia Bio LPG Market Regional Analysis

By region, New South Wales leads the market growth

New South Wales accounts for a significant share of the Australia bio LPG market, supported by both residential and commercial uptake. The state's updated Renewable Fuels Strategy identifies Bio-LPG as an important decarbonization option, particularly for regional residences and businesses that cannot rely on a steady supply of power. Certification initiatives such as GreenPower renewable LPG are helping formalize the market and provide confidence to consumers and suppliers alike. In November 2025, Gas Energy Australia welcomed the NSW Renewable Fuels Strategy, highlighting its importance in supporting practical, technology-agnostic renewable fuel adoption.

The Australia bio LPG market is observing notable growth in the Australian Capital Territory as the region remains dedicated to green energy transformation, which affects the demand for the low-carbon fuel as well as bio LPG fuel substitutes, where the electrification process can be slow. The ACT has attained 100 percent supply of renewable electricity, and by 2045, the aim is to eliminate fossil fuel gas, thus promoting energy transitions that complement the use of renewable gas and market innovation. This policy framework will provide an enabling environment for renewable fuel solutions in the energy mix of Canberra.

Competitive Landscape

The Australia bio LPG market players are also aggressively seeking strategic partnerships, joint ventures, and infrastructure upgrades to enhance supply chains and production capacity. Companies are also securing the constant supply of renewable feedstock and technology by working with their suppliers and technology firms, minimizing operational risks. Such efforts are coordinated to speed up the process of commercializing bio-LPG and increasing its supply in residential, industrial, and transport sectors.

Many bio LPG companies in Australia are also undertaking proof-of-concept programs, pilot projects, and circular economy initiatives to confirm that renewable fuel technology works and develop scalable examples in LPG production. Refinery upgrades, trial deployments, and diversification of feedstock reflect a commitment to sustainability and reliability in operations. These are the proactive initiatives made by market actors that not only encourage innovation but also promote investor confidence in favor of long-term growth and the uptake in the Australia bio LPG market.

Viva Energy Group

Viva Energy Group is a major energy company based in Melbourne, Australia, which was established in 2014 and primarily specializes in refining, marketing, and distributing petroleum and renewable fuels. The company is engaged in the growth of its portfolio that incorporates low-carbon solutions like bio-LPG and renewable diesel.

Origin Energy Limited

Origin Energy is an Australian-based firm that was established in 2000 and headquartered in Sydney, Australia, and is a big integrated energy corporation dealing with electricity and gas as, well as renewable energy production. Sustainable fuel has been another area of interest for the company, including joining hands with other partners to come up with bio-LPG and other bio-related fuel projects.

Shell plc

Shell plc is an international energy powerhouse, dealing in oil, gas, and renewable energy, and was established in 1907, based in the Hague, Netherlands. To help the company make the move towards a more sustainable energy portfolio, the company is investing in low-carbon technologies and fuels, such as bio-LPG.

Key Highlights of the Australia Bio LPG Market Report

• The report presents a thorough evaluation of historical trends and a precise forecast of the market on a weekly/monthly basis using 2035, and the stakeholders in the company can plan without fear.
• Competitive Landscape Analysis: Detailed analysis of major domestic and global manufacturers, their strategies in the market, major products, and growth patterns.
• Regional Market Assessment: Comprehensive regional analysis to determine new markets, geographies of high growth, and local industry trends.
• Investment-Based Perspective: Actionable information that is supported by quantitative data that helps investors to consider the opportunities and make strategic decisions.

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• Trusted Insights: Relies mainly on primary research on the provision of reliable and believable market intelligence.
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• In-depth Segmentation: Regional analysis and product-based analysis in order to gain an in-depth insight into market opportunities.

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