This article investigates how biogas technology can facilitate the deployment of municipal circular bio-economic solutions within the energy and agrarian sectors in Denmark. The emphasis is on the regional climate policy and the existing biogas technology concepts, within a decentralized energy market located in the Southern part of Zealand. The case analysis will identify how such technology can be utilized as a lever for future “extraction-activities,” as for example protein, wax, and furfural substrates. Within Falster & Lolland Municipalities, it is identified that 800.000 tons of animal manure is readily available for biogas production, just as 880.000 tons and 220.000 tons of unused beet tops and residual cereal straw could be feed to biogas facilities as for example co-silage materials. With a potential gas yield of approximately 897.000 MWh, composed by the crop residues alone, the challenge is how to utilize such resources the most efficient when addressing future needs for bio-products and high value materials and energy. Through the lens of Circular Bio-Economy this article addresses three themes, by which biogas technology can become an “engine” for future bioenergy solutions, where cascading activities and use of side-streams are developed: 1) production of biogas by means of local agricultural residues (beet tops, residual straw, and animal manure), combined with 2) “extraction-activities” as furfural and wax from straw, as well as protein from beet tops. Besides this 3) opportunities for upgrading the biogas and distributing it on a natural gas network, hereby enlarging the supply market for energy services from the biogas plant and facilitating the development of a more “integrated energy system,” currently being promoted by the European Commission. This article concludes on a step-by-step approach to utilize biomass residues more efficiently in light of the CBE concept and cascading approach, and the available biomass resources within the specific case area addressed.