The UK government has approved a £100 million grant to reopen a shuttered carbon dioxide (CO2) plant in Teesside, citing concerns that the war in Iran could lead to shortages of the gas essential for industries including food and drink, healthcare, and nuclear power.
The Ensus plant, which was mothballed in September after a trade deal with the US reduced tariffs on bioethanol imports, will restart operations for an initial three-month period. Business Secretary Peter Kyle said the intervention was necessary to protect critical UK sectors from global uncertainty.
CO2 is a byproduct of bioethanol production at the plant, which converts wheat into fuel. The government hopes the facility can remain open indefinitely after the initial period. Grant Pearson, chair of Ensus UK, said the support would strengthen the Teesside manufacturing economy and the UK's resilience in CO2 supplies.
The move follows warnings from energy consultancy Cornwall Insight that rising energy costs could increase business electricity bills by 10-30% and gas bills by 25-80%. The Department for Business and Trade said the reopening is part of wider efforts to ensure access to critical resources during global supply shocks.
This is not the first CO2 crisis for the UK; in 2021, the government provided a temporary bailout to CF Fertilisers after soaring gas prices disrupted supply. In 2018, Warburtons and Heineken faced production halts due to a global shortage.
