The UK carbon dioxide (CO2) industry has struck a deal to ensure supplies to businesses, including those in the food processing sector, and avoid CO2 shortages.
CF Fertilisers (CFF), which produces 60% of the UK’s CO2 from its two plants in northern England, temporarily closed its plants last month due to the rapid rise in natural gas prices.
But CO2 suppliers have agreed to pay CFF, an indirect subsidiary of US company CF Industries, a manufacturer and distributor of agricultural fertilisers, a price for the CO2 it produces that will enable it to continue operating while global gas prices remain high.
Last month, the UK government agreed for exceptional, time-limited (three weeks) support for CF Fertilisers to get the company operational again.
The new deal, announced by the UK government’s Department of Business, Energy and Industrial Strategy, runs until January 2022 and means that key sectors, including food processing and nuclear power, are ensured supplies of CO2.
CFF produces CO2 as a by-product of fertiliser and the CO2 is then used by suppliers of meat, poultry and fizzy drinks manufacturers. CO2 is also vital product for the slaughter of animals.
The UK government’s Business Secretary Kwasi Kwarteng said, “Today’s agreement means that critical industries can have confidence in their supplies of CO2 over the coming months without further taxpayer support. The government acted quickly to provide CF Fertilisers with the support it needed to kick-start production, and give us enough breathing space to agree a longer-term, more sustainable solution.”
Last week, Kwarteng temporarily exempted parts of the CO2 industry from competition law to facilitate this agreement and provide further security of CO2 supplies to UK businesses.
Also, major commercial CO2 producer Ensus reopened its Wilton plant last week following temporary closure for planned maintenance, in another boost to CO2 supplies. The Wilton plant can produce up to 40% of the UK’s CO2 requirements.
No details about the price of CO2 were revealed by the UK government as part of the deal.