The United Kingdom carbon dioxide (CO₂) market attained a volume of 725.8 KMT in 2024. The market is estimated to witness a CAGR of 1.5% during 2025-2034, reaching a volume of 840.5 KMT by 2034. This steady growth reflects the increasing importance of carbon dioxide in various industries such as food and beverages, medical applications, and metal fabrication. The United Kingdom carbon dioxide market is also shaped by advancements in carbon capture technologies, regulatory frameworks, and the adoption of sustainable production methods.
This blog post explores the key segments of the United Kingdom carbon dioxide market, assesses its production dynamics, and highlights the role of leading companies.
Key Market Segmentation by Source
Ammonia
Ammonia production is a primary source of CO₂ in the United Kingdom carbon dioxide market, as CO₂ is a by-product of ammonia manufacturing. This process is essential for industries requiring food-grade carbon dioxide. Companies like Yara International ASA and Tata Chemicals Europe Limited have invested in advanced CO₂ recovery systems to enhance CO₂ capture and ensure a sustainable supply.
Ethyl Alcohol
The fermentation of ethyl alcohol produces significant volumes of CO₂, primarily used in the food and beverage industry. Bio-based CO₂ from this source is gaining traction as a cleaner alternative to fossil-fuel-derived carbon dioxide. As the demand for biofuels and alcoholic beverages continues to grow, ethyl alcohol production is expected to play a pivotal role in the United Kingdom carbon dioxide market.
Substitute Natural Gas (SNG)
SNG processes also contribute to CO₂ supply in the United Kingdom carbon dioxide market, particularly for industrial applications. Companies such as BOC Limited (Linde) are developing innovative solutions to capture CO₂ efficiently from SNG processes while reducing emissions.
Market Segmentation by Production
Biological Production
Biological methods, including fermentation and anaerobic digestion, are gaining prominence in the United Kingdom carbon dioxide market. These methods are not only more sustainable but also reduce environmental impact compared to traditional processes. Bio-based CO₂ production is particularly relevant in industries focused on reducing their carbon footprint.
Combustion Production
Combustion remains a significant method of CO₂ production in the United Kingdom carbon dioxide market. However, it faces challenges due to environmental concerns. Companies like Air Liquide UK Ltd and Air Products PLC are investing in carbon capture, utilization, and storage (CCUS) technologies to reduce emissions and enhance the efficiency of CO₂ recovery.
Key Market Segmentation by End Use
Food and Beverages
The food and beverages industry is the largest consumer of CO₂ in the United Kingdom carbon dioxide market. Carbon dioxide is used in carbonated beverages, food preservation, and packaging processes. With the UK’s vibrant food and drink sector growing steadily, companies like BioCarbonics Ltd. and BOC Limited (Linde) are focusing on sustainable CO₂ solutions to meet rising demand.
Oil and Gas
In the oil and gas industry, CO₂ is primarily used for enhanced oil recovery (EOR) processes. While the demand for EOR applications may decline as the UK transitions to renewable energy, companies such as Air Products PLC continue to support this segment by providing high-quality CO₂ for industrial processes.
Medical Applications
In the medical field, CO₂ is essential for surgeries, respiratory therapies, and other applications. The growing healthcare sector in the UK, coupled with advancements in medical technologies, is expected to boost demand for medical-grade CO₂ over the coming years. Nippon Gases and Progases (UK) Ltd are key suppliers of medical-grade CO₂, ensuring compliance with strict quality and safety standards.
Metal Fabrication
The use of CO₂ in metal fabrication processes, including welding and cutting, remains significant in the United Kingdom carbon dioxide market. As manufacturing activities in sectors like automotive and construction expand, demand for CO₂ in metal fabrication is set to grow. Companies such as Tata Chemicals Europe Limited and Air Liquide UK Ltd are expected to play a critical role in meeting industrial CO₂ requirements.
Other Applications
Additional applications of CO₂ in the United Kingdom carbon dioxide market include its use in chemical production, water treatment, and fire suppression systems. These diverse applications contribute to consistent demand across various sectors.
Market Dynamics
SWOT Analysis
Strengths
- Established infrastructure for CO₂ production and distribution.
- Strong presence of key players offering diverse solutions.
- Increasing demand across multiple industrial sectors.
Weaknesses
- Reliance on a few primary CO₂ sources like ammonia and ethyl alcohol.
- Environmental concerns related to traditional production methods.
Opportunities
- Advancements in carbon capture and utilization technologies.
- Growing interest in bio-based CO₂ production methods.
- Rising focus on sustainability and circular economy initiatives.
Threats
- Stringent environmental regulations on emissions.
- Supply chain disruptions due to geopolitical or economic factors.
- Competition from alternative gases and substitutes.
Porter’s Five Forces Analysis
- Threat of New Entrants: High capital requirements and regulatory barriers limit market entry in the United Kingdom carbon dioxide market.
- Bargaining Power of Suppliers: Limited CO₂ sources give suppliers moderate power in the market.
- Bargaining Power of Buyers: Buyers benefit from multiple suppliers but demand high quality and consistent delivery.
- Threat of Substitutes: Emerging alternatives could pose a long-term threat to traditional CO₂ usage.
- Industry Rivalry: Competition among established players drives innovation and cost efficiency.
Regional Insights
Urban centers like London, Birmingham, and Manchester dominate CO₂ demand in the United Kingdom carbon dioxide market due to their industrial concentration. Meanwhile, rural areas are experiencing growth as industries expand outside metropolitan regions. Companies such as BOC Limited (Linde) and Air Liquide UK Ltd are optimizing supply chain management to balance regional demand and production.
Competitive Landscape
The United Kingdom carbon dioxide market features several leading players committed to innovation and sustainability. Key companies include:
- Ensus UK Limited: Focuses on bioethanol production, contributing to biological CO₂ generation.
- BioCarbonics Ltd.: Specializes in bio-based CO₂ solutions for the food and beverage sector.
- Tata Chemicals Europe Limited: Provides industrial-grade CO₂ for metal fabrication and other applications.
- Yara International ASA: Operates advanced CO₂ recovery systems in ammonia plants.
- Air Products PLC: Pioneers carbon capture and storage technologies for sustainable production.
- BOC Limited (Linde): Offers diverse CO₂ solutions for industrial and medical applications.
- Air Liquide UK Ltd: Invests in sustainable CO₂ production and distribution technologies.
- Nippon Gases: Supplies high-quality CO₂ for medical and industrial sectors.
- Progases (UK) Ltd: Focuses on meeting specific CO₂ requirements for various industries.