Hot water extraction (HWE) removes hemicellulose from woody biomass to give improved end products while producing a sugar-rich by-product stream, which requires proper treatment before disposal. Hot water extracted Norway spruce (Picea abies) at two different pretreatment conditions (140 °C for 300 min (H140) and 170 °C for 90 min (H170)) generated hydrolysate as a by-product, which was used in mesophilic anaerobic digestion (AD) as substrate. H140 gave a higher methane yield (210 NmL/g COD—chemical oxygen demand) than H170 (148 NmL/g COD) despite having a lower concentration of sugars, suggesting that different levels of inhibitors (furans and soluble lignin) and recalcitrant compounds (soluble lignin) affected the methane yield significantly. Organic loads (OLs) had a negative effect on the methane yield, as observed during AD of H170, while such an effect was not observed in the case of H140. This suggests that the decrease in methane yield (32%) of H170 compared to H140 is primarily due to inhibitors, while the decrease in methane yield (19%) of H140 compared to the synthetic hydrolysate is primarily due to recalcitrant substances. Therefore, both OL and pretreatment conditions must be considered for efficient anaerobic digestion from hydrolysate for enhanced methane production.