The shift from fossil economy to bio-economy will stimulate the demand for bio-based energy generation. The promising strategy to meet the growing demand of biomass for energy production is to re-cultivate set-aside arable land. The digestate fertilization approach for the sake of increased biomass yields is the key strategy towards sustainable biogas generation in many regions. In order to minimise digestate utilization costs, biogas plant operators seek to spread the liquid digestate as close as possible to its storage location. The present work is focused on the evaluation of the digestate impact for the eroded agricultural soil, the improved biomass yield of semi-natural grassland biomass and its biogas potential. Three-year field experiments results indicate the positive effect of solid and liquid digestate on soil fertility and quality. The amount of dissolved organic carbon in eroded loamy Retisol increased 3.7% and 15% in soil 0–10 cm layer with fertilization rate of 170 kg ha -1 N of liquid and solid digestate, respectively. In terms of total nitrogen 11.6% and 20% increase was achieved using 170 kg ha -1 N of liquid and solid digestate compared to the untreated. Furthermore, the grass fresh biomass yield was up to 3 times higher compared to untreated. The biomethane yield of biomass from digestate fertilized fields was higher for every fertilization rate applied. The highest biomethane yield was for 170 kg N ha-1 liquid digestate applied yielding 19% more biogas compared to untreated field biomass both due to increased biogas yield and increased methane content.