The government has reached an agreement with UK suppliers to ensure a secure provision of CO2 until early 2022.
CO2 suppliers will pay fertiliser manufacturer CF Fertilisers a sufficient price to enable the firm to supply the food industry while global prices remain high.
The news follows the government’s three-week deal with the company in September when it used public funds to reopen its Billingham plant, which shut down earlier in the month due to spiking natural gas prices.
The government said that this was an “exceptional” arrangement which will secure CO2 supplies until the start of next year.
Until then, it will work with the sector to find alternative sources of CO2.
According to ministers, CF Fertilisers is currently responsible for 60 per cent of the country’s commercial CO2 requirements.
They also said that the Ensus Wilton plant, which has reopened following a short-term closure for planned maintenance, will be able to produce up to 40 per cent of the UK’s remaining CO2 requirements.
“Today’s agreement means that critical industries can have confidence in their supplies of CO2 over the coming months without further taxpayer support,” Business Secretary Kwasi Kwarteng said.
“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.”
Environment Secretary George Eustice added: “CO2 is vital to our food and drink sectors.
“The government has taken decisive action in these exceptional circumstances to allow a deal to be reached which will continue the supply of CO2 to businesses – including thousands of food and drink businesses – up and down the country.”