VIVERGO FUELS has said it is looking to close the UK’s largest bioethanol plant by the end of September, blaming high wheat prices and delays implementing biofuels legislation.
The plant in Hull produces 420m L/y of bioethanol, making it the largest producer in the UK and second largest in Europe. It halted production late last year before resuming operations in March. Vivergo Fuels is consulting on ceasing production from 30 September for an “indeterminate period of time”, a spokesperson said.
“It won’t be like it was earlier in the year – where we turned it off and turned it back on,” the spokesperson said. Asked whether the company has ruled out resuming production in the future, she added: “I would never want to say never”.
Vivergo Fuels employs more than 130 people at the plant and its head office, as well as supporting an estimated 3,000 jobs in the supply chain. It processes 1.1m t/y of wheat from 900 farms, and supplies 500,000 t/y of animal feed to 800 farms.
“I am extremely disappointed at having to announce the proposed cessation of production,” said Mark Chesworth, managing director of Vivergo Fuels. The company has blamed poor market conditions, including high wheat prices, and the government’s slow implementation of rules requiring bioethanol content in fuels to be doubled from around 5% now to 10% (E10) by 2020.
“But sadly, the government’s lack of pace over the past decade to introduce E10 has further undermined our ability to operate. My employees are my number one concern at this time and we have entered into consultation with them.”
The UK Petroleum Industry Association (UKPIA) said it regrets the proposed closure of the plant though expects industry will make up the shortfall with alternative supplies.
“Following closure of the plant, petrol suppliers will seek alternative sources of bioethanol, but this is not anticipated to lead to any supply disruption at filling stations or any reduction in the bioethanol content of unleaded and premium grade petrol,” said Andy Roberts, director of downstream policy at UKPIA.
The closure is expected to disrupt farmers however, with the National Farmers Union saying the news will come as a blow to both suppliers of wheat and buyers of animals feed.
“As the largest single intake for feed wheat in the county, it will particularly hit arable and livestock farmers in the North East where the plant is based,” said Tom Bradshaw, NFU combinable crops board chairman.
“Farmers have made long-term commitments to supply the biofuel industry and will be frustrated they are now left with a much-reduced market for their product.
Vivergo Fuels was set up as a joint venture between AB Sugar, BP and DuPont in 2007 to create a biorefinery for the future.
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