The UK’s fledgling bioethanol industry is on the brink of disaster. Despite the threat to a key industry, the government has not responded with any financial rescue package. This decision follows months of collaboration between government officials and bioethanol companies, including major producers Vivergo Fuels and the Ensus plant. The feds are digging in their heels, unwilling to spend a single taxpayer dollar to prop up the sector. This decision has continued to raise fears of widespread job losses and other harms to the agricultural supply chain.
Bioethanol is a renewable fuel that can be produced from various crops, such as wheat, maize and sugar beet. In the UK it’s widely mixed with petrol, particularly in E10 petrol. The new US-UK trade deal subsequently eliminated the UK’s 19% tariff on US ethanol imports. Now this limit has been increased to allow up to 1.4 billion liters to flow into the UK market. Yet, the British bioethanol sector continues to find it difficult to compete against these imported fuels.
Vivergo Fuels in Hull is an important part of the UK’s bioethanol production. At the same time, the Ensus plant in Redcar on Teesside is another important player in this growing industry. Vivergo Fuels has shouted from the rooftops about the harmful ramifications of the government’s decision, arguing that
“In making this decision, the government has thrown away billions in potential growth in the Humber, a sovereign capability in clean fuels that had the chance to lead the world.”
For Ensus, the plant is owned by a German company. It is currently responsible for more than 30% of the UK’s commercial carbon dioxide production. The potential closure of both facilities could lead to significant job losses, impacting around 270 employees directly and thousands more within the supply chain.
The new bioethanol plant will be purchasing thousands of tonnes of surplus wheat grown by UK farmers. This simple yet important step goes a long way toward promoting regional agriculture. With the recent government announcement, farmers and producers on both sides of the Atlantic are again plunged into uncertainty as to what the future holds.
Aside from the overtly economic aspects, the UK government has aimed for ambitious targets for the use of sustainable fuels. According to the plan, officials would like to see by 2030 10% of all fuel consumed in planes to be sustainable, such as bioethanol. Withdrawal of support for the policy’s domestic bioethanol industry could stall the move towards this goal.
“This plant should always have been profitable under the right regulatory environment, as similar plants in Western Europe demonstrate.”
In addition to economic considerations, the UK government has set ambitious targets for sustainable fuel use. By 2030, officials aim for 10% of all fuel used in aircraft to come from sustainable sources, including bioethanol. The lack of support for the domestic bioethanol industry may hinder progress toward this goal.