Government subsidies helped once-expensive clean energy sources like wind and solar grow until their costs dropped. That may not be the case for so-called renewable natural gas.

Why it matters: Natural gas captured from landfills, dairy farms and other non-fossil sources is booming — but the growth is heavily dependent on taxpayer dollars, Alan writes.

Zoom in: RNG production for transportation has posted double-digit growth every year for the past decade, per data released by S&P Global Commodity Insights.

• Production took off when the federal government and states like California began paying farmers and landfills to make RNG.

Yes, but: RNG volumes are just 0.2% of those for conventional natural gas.

Background: The federal Renewable Fuel Standard and state measures like California's Low-Carbon Fuel Standard have created generous incentives for RNG.

• How generous? The assessed value of RNG from landfills was about $26-$30, per S&P. The benchmark Henry Hub spot price for conventional natural gas: $2.60.

Catch up fast: RNG basically functions the same as natural gas. But instead of coming from the ground, it comes from sources like cows, manure or decomposing trash that would otherwise just vent greenhouse gas.

• RNG can use existing pipeline infrastructure and be integrated with conventional fuels. That's made it an appealing investment, especially by industry incumbents.

Yes, but: Energy subsidies are generally supposed to help a nascent industry reach economies of scale: Bring costs down for early adopters, then recede as the product becomes cost-competitive on its own. Just look at the wind and solar sectors as examples.

• That's not quite possible with RNG. Take farm waste, for example: The more RNG you need, the farther trucks have to travel to collect the wheat stalks or corn stovers to supply the production plant.

What they're saying: Investors are putting money into developing enzymes that can break down the raw materials for RNG more quickly and cheaply. But that goal so far remains elusive.

• "Without that type of breakthrough, there’s really no glide path to seeing the costs of these going down tremendously," Alex Klaessig, research and analysis director at S&P Global Commodity Insights, tells Alan.

What we’re watching: Farmers, refiners and environmentalists actively lobby for RNG subsidies, but policy can prove soft ground to build a business on — especially when faced with the hard realities of market economics.