Dimethyl Ether (DME) Synthesis From Carbon Dioxide (CO2) Market Report 2026

The dimethyl ether (dme) synthesis from carbon dioxide (co₂) market size has grown rapidly in recent years. It will grow from $1.2 billion in 2025 to $1.39 billion in 2026 at a compound annual growth rate (CAGR) of 16.2%. The growth in the historic period can be attributed to fossil fuel dependence, fuel emission regulations, methanol to dme pathways, energy diversification efforts, catalytic process development.

The dimethyl ether (dme) synthesis from carbon dioxide (co₂) market size is expected to see rapid growth in the next few years. It will grow to $2.51 billion in 2030 at a compound annual growth rate (CAGR) of 15.9%. The growth in the forecast period can be attributed to clean fuel mandates, hydrogen economy growth, renewable energy integration, carbon utilization incentives, transportation fuel decarbonization. Major trends in the forecast period include rising interest in alternative clean fuels, growing use of dme as diesel substitute, expansion of co2 hydrogenation technologies, increased focus on energy security, development of integrated ccu systems.

The increasing demand for clean and sustainable fuels is expected to drive the growth of the dimethyl ether (DME) synthesis from carbon dioxide (CO₂) market. Clean and sustainable fuels are energy sources that produce minimal environmental pollution and are derived from renewable or low-carbon resources, ensuring long-term availability without depleting natural resources. This demand is rising due to environmental concerns, as industries and consumers aim to reduce greenhouse gas emissions, combat climate change, and lessen the ecological impact of traditional fossil fuels. Dimethyl ether synthesis from CO₂ contributes to clean and sustainable fuels by converting waste CO₂ into a low-emission, renewable alternative that reduces dependence on fossil fuels. For example, in September 2023, according to the U.S. Energy Information Administration, nationwide biofuels production capacity - including renewable diesel, biodiesel, ethanol, and other biofuels - stood at 23 billion gallons per year, reflecting a 6% increase in total capacity compared to January 2022.

Companies in the DME synthesis from CO₂ market are focusing on advanced catalytic conversion technologies to enhance conversion efficiency and reduce carbon emissions. These technologies use highly efficient catalysts to accelerate chemical reactions, enabling the conversion of CO₂ into valuable fuels like DME with lower energy consumption. In November 2025, Godavari Biorefineries Limited, an India-based bio-based manufacturing company, partnered with the Institute of Chemical Technology (ICT) to launch a pilot project converting industrial CO₂ emissions directly into DME. This clean-burning, low-emission fuel serves as an eco-friendly alternative to LPG and diesel and functions as a chemical feedstock for various industrial uses. The initiative reduces greenhouse gas emissions, supports a circular economy, and aligns with India’s energy transition and rural development goals.

In April 2024, the Council of Scientific and Industrial Research (CSIR) partnered with Bharat Heavy Electricals Limited (BHEL) to develop indigenous technology for capturing and converting CO₂ into DME, which can be blended with LPG. This collaboration aims to support India’s net-zero goals by advancing sustainable carbon capture and utilization technologies that transform CO₂ emissions into a valuable, low-emission fuel.

Major companies operating in the dimethyl ether (dme) synthesis from carbon dioxide (co₂) market are Sinopec Limited, BASF SE, Linde plc, Air Liquide S.A., Johnson Matthey plc, Air Products and Chemicals Inc., Toyo Engineering Corporation, Nippon Gases Co. Ltd., Haldor Topsoe A/S, TNO, Proman AG, Mitsubishi Gas Chemical Company Inc., Oberon Fuels Inc., Real Carbon Technology Private Limited, Winspiration Energy and Engineering Pvt. Ltd., Dimeta B.V., Grillo-Werke AG, Carbon Recycling International hf, Thyssenkrupp Uhde (Uhde GmbH), Liquid Wind AB, Eni S.p.A., TotalEnergies SE.

Asia-Pacific was the largest region in the market in 2025. Europe is expected to be the fastest-growing region in the forecast period. The regions covered in the dimethyl ether (dme) synthesis from carbon dioxide (co₂) market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the dimethyl ether (dme) synthesis from carbon dioxide (co₂) market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The dimethyl ether (DME) synthesis from carbon dioxide (CO₂) market consists of revenues earned by entities by providing services such as carbon capture and utilization (CCU) services, catalyst development and optimization, process design and engineering services, technology licensing and consulting, and project development and operation services. The market value includes the value of related goods sold by the service provider or included within the service offering. The dimethyl ether (DME) synthesis from carbon dioxide (CO₂) market also includes sales of carbon monoxide, higher alcohols, formic acid, and light olefins. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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