UK Bioethanol Giant Threatens Closure Due to US Trade Agreement

Britain’s largest producer of carbon dioxide, essential for operating theatres and the food and drink industry, has issued a stark warning of “imminent” closure following the recent US-UK trade agreement. German-owned Ensus is seeking tens of millions in government subsidies to sustain Britain’s bioethanol industry, including its vital Teesside plant that produces high-purity CO₂ as a by-product.

The Teesside facility, employing over 100 staff at the Wilton site in Redcar, utilises British-grown wheat to produce bioethanol for E10 petrol blending. Both Ensus and Vivergo Fuels, owned by Associated British Foods (ABF), were caught off guard by last month’s trade deal, which eliminated tariffs on American bioethanol imports sufficient to meet the UK’s complete demand.

Grant Pearson, Ensus UK chairman, emphasised the critical nature of the situation: “We are at the 11th hour and the government urgently needs to find a solution to a crisis of its own making.” The implications extend beyond job losses, threatening crucial sectors dependent on CO₂ supply.

The Ensus facility currently supplies approximately 30% of UK CO₂ demand, vital for carbonated beverages, food preservation, medical procedures, and nuclear industry cooling. This production has become increasingly crucial since the closure of CF Fertilisers’ Billingham plant in 2022.

Time is running short as Ensus faces a critical decision within weeks regarding maintenance funding commitments. Meanwhile, ABF has announced it will initiate closure procedures for its Vivergo plant without government intervention within a fortnight.

The government spokesperson maintained: “We are working closely with the ethanol industry to find a way forward, with the Business and Transport Secretaries recently meeting industry representatives to discuss their concerns.” The removal of the current 19% tariff on US imports has created an urgent need for policy intervention to preserve domestic production capability.