There is no singular replacement for fossil fuels, but a series of targeted replacements, each of which provides a unique set of benefits and complexities when it comes to production and storage.
From a technical standpoint, that is where dedicated pressure relief valves and other safety equipment come in, but there are some issues on an industry-wide level that could undermine the investment in dedicated equipment.
The UK’s domestic biofuel sector went from a cautiously optimistic but growing sector at the start of 2025 to facing an existential crisis by the end of summer, with one major company having entered the irreversible process of closing.
Only one domestic biofuel manufacturer, Ensus, is still around, but it has warned that it too is at risk of closing unless action is taken to save the sector quickly.
What has gone wrong for British biofuel so quickly, and is it already too late to fix the damage?
Why Is Biofuel Production So Important To The UK?
Biofuel itself is a hugely important low-carbon fuel that can be incorporated and blended into existing supplies of fuel for transportation, shipping and aviation.
This makes it hugely important for energy security as fuel that is produced domestically reduces the reliance on imports and the geopolitical factors that can affect supply.
However, beyond bioethanol, biofuel production also produces high-protein feedstock and carbon dioxide as by-products, the latter of which is an essential part of the production of food and drinks even beyond fizzy beverages.
It also helps agricultural production, as it provides a guaranteed domestic buyer for supplies of certain types of crops used for biofuel, as well as alternative uses for waste oils, which are often otherwise discarded or cause issues for plumbing and drainage.
What Have Been The Issues With The UK Biofuel Sector?
Before the situation abruptly deteriorated in mid-2025, there were concerns about the UK biofuel sector, which produces and sells around 1.4 billion litres of bioethanol.
The issues are a mix of policy decisions, trade decisions that restrict the import of certain types of feedstock compounded with other trade decisions that encourage the price dumping of biofuel in ways that undermine the market.
The biofuel conglomerate Argent Energy pulled out of the UK market for these reasons, noting that Brexit restrictions on tallow imports made the production of biofuel increasingly unviable.
This was compounded by the Renewable Transport Fuel Obligation (RFTO) requirements, which produce a market for biofuel in the UK and provide incentives for the transport sector to use biofuel and for producers to supply it.
The issue with the RFTO as it exists is that imported fuel can also meet these obligations, which allows countries with more favourable policy and agricultural conditions to flood the market with cheaper biofuel than it is possible to produce domestically.
In particular, Chinese biofuel production is heavily subsidised, and the United States of America produces vast amounts of corn that is ideal for biofuel production.
The RFTO does not provide incentives for a transport business, such as a heavy goods vehicle fleet, to buy biofuel from UK suppliers, so they will go for the cheapest option based on the market conditions.
This means, therefore, that whilst the market for biofuels has grown exponentially, the UK has not stood to benefit from it either economically or in terms of carbon credits, and loss-making biofuel plants expecting to enter profitability have been squeezed further.
Has The UK Reached A Point Of No Return?
The big change, and one that turned a difficult but reversible market downturn into a meltdown that poses an existential risk to the entire market, is a recent trade agreement with the United States.
Following the imposition of blanket tariffs on the entire world, the UK negotiated a deal to allow 1.4 billion litres of US bioethanol to be imported without tariffs. As noted before, this is the size of the entire UK biofuel market.
The deal, an attempt to lower tariffs on cars, steel and parts for aeroplanes, has been criticised for essentially sacrificing the UK biofuel sector in the process, as there is no way that the UK can compete with significantly cheaper US fuel.
There were, up until Vivergo closed, potential avenues to stem the collapse, either by providing outright financial support, by increasing the RFTO in order to increase demand for biofuel or by adding incentives to buy domestic biofuel.
Ensus is still in business, and it remains to be seen what happens next to the UK biofuel sector.
However, it is clear that at present it is in a crisis that will require significant and decisive action to escape.
