The UK government has approved a £100 million grant to reopen a mothballed carbon dioxide plant in Teesside, amid fears that the war in Iran could lead to shortages of the gas. The Ensus plant, which was shut down in September, will restart production for at least three months, with hopes of indefinite operation.
Business Secretary Peter Kyle authorised the reopening to bolster CO2 supplies, which are essential for carbonating drinks, preserving food, medical procedures, and sedating animals for slaughter. The plant was mothballed after a trade deal with the US reduced tariffs on bioethanol imports, making domestic production unviable.
An unnamed government official noted the irony that the plant closed due to a deal with Donald Trump and is now reopening because of his war in Iran. The Department for Business and Trade announced the move on Thursday, stating it would strengthen the UK's resilience in CO2 supplies.
Grant Pearson, chair of Ensus UK, said the support would benefit the Teesside manufacturing economy and critical sectors including food, drink, hospitals, and the nuclear industry. Kyle emphasised the government's commitment to protecting British businesses from global uncertainty, having kept the plant on standby since autumn.
The intervention comes as Cornwall Insight predicts rising energy costs could increase business electricity bills by 10-30% and gas bills by 25-80%. The UK previously faced a CO2 crisis in 2021, leading to a temporary bailout for CF Fertilisers, and in 2018, shortages forced Warburtons and Heineken to halt production.
