The UK’s domestic ethanol industry is entering a period of acute uncertainty, and the consequences reach far beyond fuel production. Ensus and Vivergo Fuels – the country’s two major bioethanol producers – are facing intense commercial pressure following the removal of tariffs on large volumes of cheaper US ethanol imports. Industry leaders warn that without urgent intervention, both plants may wind down operations, triggering a significant loss of the UK’s already strained supply of industrial CO2.
Ethanol facilities play a critical but often overlooked role in the UK’s gas infrastructure. The fermentation process used to create bioethanol also produces high‑purity CO2, much of which is captured and supplied to the food, drink, and healthcare sectors. Should these plants close, industry groups estimate that the UK could lose up to 80% of its domestically produced CO2, a staggering figure that would disrupt supply chains nationwide. This risk is heightened by existing supply fragility: Ensus alone provides approximately 30% of the UK’s CO2 demand, meaning the loss of even a single producer would inevitably strain industrial users.
The consequences would quickly ripple across essential sectors. CO2 is indispensable for stunning livestock in abattoirs, preserving packaged meat, carbonating beverages, producing dry ice for medical transport, and maintaining controlled atmospheres in food processing. With shortages already hitting Europe in recent years, industry bodies warn that another major supply shock could lead to reduced meat production, fewer carbonated beverages, increased food waste, and operational challenges within healthcare settings. These concerns echo the 2021 CO2 crisis, when supply chain stress brought the UK within days of supermarket shortages and forced some producers to reduce output.
The root of today’s risk lies in the recent UK‑US trade deal, which removed the 19% tariff on up to 1.4 billion litres of imported US ethanol – roughly equivalent to the UK’s total annual demand. Domestic producers, who rely on UK‑grown wheat and face higher operational costs, have been left unable to compete with heavily scaled, subsidised US production. Ensus has warned that without government subsidies, it may have to abandon a major upcoming maintenance programme and begin a full shutdown. Vivergo has issued similar warnings, stating that the new trade terms could mark the end of the British bioethanol sector without immediate government support.
The loss of these facilities would leave the UK deeply exposed to international CO2 markets – markets already subject to volatility, contamination incidents, and production outages abroad. This vulnerability is especially concerning given the UK’s declining number of domestic CO2 producers; the closure of CF Fertilisers’ Billingham site in 2022 has already reduced the country’s self‑sufficiency. If Ensus or Vivergo shutter their operations, the UK could find itself with almost no remaining large‑scale sources of home‑grown CO2.
Industry figures are urging the government to act decisively, both to stabilise the ethanol market and to protect the UK’s sovereign CO2 supply. Without targeted support, the country risks repeating – and potentially surpassing – the supply chain crises of recent years. The message from producers is clear: ethanol production is not just a renewable fuel issue. It is a cornerstone of the UK’s industrial CO2 lifeline, and its collapse would reverberate across every corner of food, drink, agriculture, and healthcare.
Sources
- U.K. ethanol collapse threatens meat, beer and beyond – FarmProgress / Bloomberg (Mission Zero)
- UK’s biggest bioethanol firm warns of CO2 production loss without subsidies – Business Quarter (Food Logistics)
- UK’s Trump deal threatens CO2 shortage – hitting meat, beer and NHS operations – iNews (Yahoo)
- UK bioethanol plant warns of imminent closure after US trade deal – The Chemical Engineer (The Independent)