In this study, based on the perspective of effectiveness, the entire process of the biogas project is divided into two sub-processes (biogas production and biogas consumption). We utilize the additive two-stage Data Envelopment Analysis to evaluate the efficiency of biogas project subsidy policy. Our finding indicates that from the perspective of input-output efficiency, the efficiency of biogas project subsidy policy is low in China. There are two main reasons for this result: the subsidy is inadequate and its purpose deviates from the actual demand. First, because the subsidy is inadequate and the construction cost of the rural biogas project is high, farmers are unable to build rural household biogas digesters by raising funds themselves. Second, the biogas project subsidy policy only stimulates the increase in biogas production through increasing the construction of large and middle scale biogas projects. But the construction of a household biogas digester is ignored. Furthermore, macro-affecting factors have a significant influence on the implementation of biogas project subsidy policy. When formulating new biogas project subsidy policy, the government should consider the influence of urbanization, per capita annual income, and international oil price fluctuations. The above analysis could provide theoretical guidance for the government to formulate new biogas project subsidy policy.