LONDON — The British government has less than a month to save 160 jobs at a
major bioethanol producer, its bosses are warning, as the industry reels from
the U.K.-U.S. trade deal signed by Donald Trump and Keir Starmer.
Vivergo Fuels Managing Director Ben Hackett said his company is at risk of
closure and that if the government can’t provide financial support in time,
redundancies will begin imminently.
“The consultation process legally has to run for a minimum of 45 days and that
day is Aug. 17, so the first redundancies could take place the week of Aug. 18,”
Hackett said. “The clock is ticking, the government’s very much aware of our
timelines and is now working with us on that negotiation.”
As part of the U.K.-U.S. Economic Prosperity Deal, struck between the Trump
administration and Starmer’s U.K. government, the U.K. granted Washington a new
tariff-free quota of up to 1.4 billion liters of ethanol, which is used in
farming and as a fuel source.
Hackett said this is worth “the entire” U.K. bioethanol market. Previously, U.S.
ethanol imported into the U.K. faced tariffs ranging from 10 to 50 percent.
“Those tariffs are in place, not because we’re worse at making ethanol than the
U.S. — they use genetically modified corn, antibiotics, they have lower energy
costs and they have tax subsidies from the government,” explained Hackett. “The
tariffs were just to say we wanted a level playing field.”
Britain’s chemical industry, including multinational INEOS, the Chemical
Business Association and px Group, are already urging the government to
intervene, warning that the closure of Vivergo Fuel would not only put jobs at
risk, but also billions in investment — as well as the country’s long-term
energy security.
Last month, Vivergo signed a £1.25 billion memorandum of understanding with Meld
Energy to supply feedstock for a new sustainable aviation fuel plant at Saltend,
Hull. Separately, it’s planning a £250 million hydrogen production facility on
the same site. “If we disappear, that goes because there’s no-one to take the
green hydrogen and there’s no raw material to turn into aviation [fuel],” warned
Hackett.
“You’re putting at risk a billion pound investment into the Saltend site,” he
said. “Hull is not the most economically advantaged part of the U.K. That
billion pounds of investment would have added thousands more jobs. By taking
away that bioethanol industry, you lose all future growth.”
Hackett says the British government has been “relatively slow to come to the
table.” It has now appointed an adviser to hear the business case and recommend
whether Vivergo should receive state financial support. “Unless we get
sufficient concrete assurances from the government, then I will go ahead and
close the business,” said Hackett.
The warning comes as a string of chemicals and bioeconomy producers shutter
operations, including INEOS’s refinery at Grangemouth and SABIC’s Olefins 6
cracker on Teesside. The Ensus bioethanol plant at Wilton is also at risk of
closure.
A British government spokesperson said: “We recognise this is a concerning time
for workers and their families which is why we entered into negotiations with
the company on potential financial support last month.”
They added: “We will continue to take proactive steps to address the
long-standing challenges the company faces and remain committed to working
closely with them throughout this period to present a plan for a way forward
that protects supply chains, jobs and livelihoods.”