UK CO2 supply strain exposes dependency on big producers

Carbon dioxide supply is tightening across the UK, with industry sources warning that the system remains highly vulnerable to disruption. While seasonal dips in supply are expected in summer, producers say the issue is intensified by an over-reliance on a small number of high-volume producers in the UK and Europe.

Summer shortages are a familiar pattern in the industrial gases sector. Demand typically spikes in the food and beverage industry, just as ammonia and bioethanol plants – key producers of by-product CO2 – scale back for maintenance, having already met the winter-driven demand for fertiliser and fuel.

However, multiple warning lights have been flashing this year. At least one UK plant is currently facing technical difficulties, while two major European CO2-producing plants are reportedly operating well below capacity.

“We’ve seen availability tighten recently,” said Simon Barker, Commercial Director at Pro Gases UK. “While this isn’t 2018 or the early energy crisis, the situation is fragile. One more major outage could tip the balance.”

The UK does produce some of its own CO2, mainly from ammonia and bioethanol plants, but it also relies heavily on European imports to meet industrial and food-grade demand. When those imports slow, the UK market feels it fast.

In Lithuania, fertiliser and ammonia producer Achema curtailed production indefinitely from May 2025, citing high energy costs and competition from cheaper imports from Africa and Russia. With less surplus ammonia being made across the continent, less CO2 is captured and made available for export.

The situation is compounded by domestic uncertainty. The Ensus bioethanol plant in Teesside – responsible for around 30% of the UK’s food-grade CO2 – is under economic pressure due to collapsing margins and the threat of cheaper US imports following a new US–UK trade deal. The company has warned that without urgent government support, it may be forced into a temporary shutdown or early maintenance.

Ensus’ Redcar bioethanol plant in Teesside ©Ensus

“The consequences will be felt across multiple sectors, including agriculture, the food and drink industry, hospital operating theatres, nuclear power generation, the development of sustainable aviation and maritime fuels and the decarbonisation of the chemical industry,” said Ensus UK Chairman Grant Pearson.

While Pearson warned of widespread consequences if production falters at major CO2 hubs like Ensus, Barker confirmed that some industrial users are already feeling the effects on the ground.

“Some of our multinational clients are already facing production shutdowns, and we’re trying to support them through our UK-based sources,” Barker told gasworld. “Prices are holding steady for now, but if supply dips further the market will feel it.”

For Barker, the current strain highlights the same unresolved structural weakness exposed during previous supply shocks in 2018 and 2021. “It’s the same old risk: too much dependence on a few massive producers,” he said.

Despite repeated market disruptions, little has changed. The UK has no mandated CO2 storage reserves, limited access to alternative supply chains, and no clear strategy as yet to strengthen long-term resilience.

Pro Gases believes that the solution lies in decentralisation. Hundreds of smaller biogenic CO2 plants producing between 10,000 and 14,000 tonnes of CO2 annually could offer both reliability and renewability, according to Barker.

“They’re not only renewable, but far more reliable for business,” he said. “We see these as the key to a more stable, resilient future.”