Taxpayers to help fund CO2 production to prevent food shortages

Food shortages had been feared in UK supermarkets.

Taxpayers will pay towards keeping the UK food sector supplied with CO2 amid the ongoing energy crisis, it has been confirmed.

A deal brokered by Business Secretary Kwasi Kwarteng will see taxpayer money used towards the operating costs of a major US-owned fertiliser manufacturer in a bid to avoid food shortages.

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At a glance: 5 key points

  • The deal will see the UK provide “limited financial support” towards the production costs of US-owned fertiliser manufacturer CF Fertilisers for three weeks.
  • The agreement has been brokered while the “CO2 market adapts” to the surge in global gas prices, according to the Department for Business, Energy and Industrial Strategy (Beis).
  • Mr Kwarteng said the decision would avert “disruption” in the “many critical industries that rely on a stable supply” of carbon dioxide.
  • Beis officials said the “exceptional short-term arrangement” with the American business would allow the company to immediately restart operations and produce CO2 at its Billingham plant in Teesside after it was forced to cease operating.
  • There had been fears that without action, the UK could face shortages on supermarket shelves.

What’s been said

Announcing the details of the agreement with CF Fertilisers, Mr Kwarteng said: “This agreement will ensure the many critical industries that rely on a stable supply of CO2 have the resources they require to avoid disruption.

“The quick and decisive action we have taken to resolve the issue shows the seriousness with which we have approached it.

“In our ongoing response to manage the impact of global gas price rises, we will continue to protect businesses and consumers.”

Background

Spiralling energy costs have led to the suspension of operations at fertiliser plants in the UK which produce CO2 as a by-product, having a knock-on effect on the food industry particularly.

CF Fertilisers produces around 60% of the UK’s CO2, used primarily by the food sector but also in the health and nuclear industries, but recently suspended operations at its Teesside and Cheshire plants because of high global gas costs.

Additional reporting by PA.

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