Recent developments in the UK energy and industrial gases market have highlighted a growing challenge: the reliability of carbon dioxide (CO₂) supply. At the same time, these disruptions are accelerating the transition toward more resilient, renewable alternatives.
In March, the UK Government intervened directly in the CO₂ market, committing £100 million to restart the Ensus bioethanol plant on Teesside. The move was triggered by concerns over potential shortages following geopolitical tensions and disruption to international supply chains.
CO₂ is a critical industrial input, used across sectors including food production, healthcare, nuclear energy, and manufacturing. However, the UK’s supply has historically been dependent on a small number of industrial processes – particularly fertiliser and ethanol production – where CO₂ is captured as a by-product. When these industries experience closures, maintenance outages, or economic pressure, CO₂ availability can quickly tighten.
The events of recent months have demonstrated how vulnerable this model can be. Government intervention to restart production is an effective short-term measure, but it also underlines the structural fragility of a system reliant on external factors such as global energy markets and geopolitical stability.
At the same time, demand for CO₂ shows no sign of declining. From carbonating beverages to preserving food and enabling medical applications, it remains essential to modern industry. With supply constrained and demand stable, reliability and security are becoming increasingly important considerations for businesses.
Alongside these challenges, a broader transformation is underway across the energy sector. Investment in renewable gas – particularly biogas and biomethane – continues to grow across the UK and Europe, driven by decarbonisation targets, regulatory frameworks, and the need for greater energy independence.
A key outcome of this shift is the emergence of biogenic CO₂. Produced during the upgrading of biogas, this form of CO₂ is derived entirely from renewable biological sources and operates within the natural carbon cycle. Unlike fossil-derived CO₂, it does not introduce new carbon into the atmosphere, making it an attractive alternative for organisations working toward net-zero targets.
Importantly, biogenic CO₂ also addresses one of the major challenges exposed by recent events: supply resilience. Because it is generated as part of a controlled, renewable process – rather than as a by-product of volatile industries — it offers a more stable and predictable supply chain.
The wider energy transition is reinforcing this shift. Policy developments, including proposals to strengthen domestic energy production and reduce exposure to global fossil fuel markets, signal a clear direction of travel: greater reliance on homegrown, low-carbon resources. As industries adapt, CO₂ supply is increasingly becoming part of this broader conversation around energy security and sustainability.
The implications for UK businesses are significant. Where CO₂ was once taken for granted as a by-product commodity, it is now emerging as a strategic input – one that requires careful sourcing, long-term planning, and alignment with environmental goals.
Organisations that prioritise security of supply, traceability, and carbon intensity will be better positioned to navigate an evolving market landscape. In contrast, reliance on traditional sources may expose businesses to continued volatility, pricing uncertainty, and supply risk.
Looking ahead
As geopolitical uncertainty persists and decarbonisation targets tighten, the role of renewable and biogenic CO₂ is expected to expand rapidly. What was once considered a niche output of the bioenergy sector is increasingly recognised as a critical component of a resilient, low-carbon industrial system.
The UK’s recent experience serves as a clear reminder: securing reliable CO₂ supply is no longer just an operational issue – it is a strategic priority.
