United Kingdom Carbon Dioxide Market Size, Share & Trends, and Forecast 2025-2034

The United Kingdom (UK) carbon dioxide market is experiencing gradual growth, as demand for CO2 continues to rise across multiple industries. The market achieved a volume of 725.8 KMT in 2024, and it is projected to expand at a compound annual growth rate (CAGR) of 1.5% from 2025 to 2034, reaching a volume of 840.5 KMT by 2034. This growth is driven by various factors such as industrial demand, the expansion of the food and beverage sector, and increasing applications in sustainable technologies. This article provides an in-depth analysis of the United Kingdom carbon dioxide market, exploring its outlook, trends, dynamics, opportunities, challenges, and competitive landscape.

United Kingdom Carbon Dioxide Market Outlook

The United Kingdom carbon dioxide market is forecast to experience consistent growth through the 2025-2034 period, with an estimated CAGR of 1.5%. This indicates that the market will grow from a volume of 725.8 KMT in 2024 to a projected volume of 840.5 KMT by 2034.

Several factors influence the market’s outlook, such as government policies on carbon emissions, the adoption of carbon capture and storage (CCS) technologies, and the expansion of CO2 usage in various sectors. As the UK works towards achieving its net-zero emissions target by 2050, the demand for CO2 remains high in specific industries, even as the country seeks to reduce overall carbon emissions.

United Kingdom Carbon Dioxide Market Share & Trends

Market Share

The United Kingdom’s carbon dioxide market holds a key position within the European market, but it remains smaller compared to other global regions. North America continues to be the largest market for CO2 due to its robust industrial and energy sectors. However, the Asia Pacific region has emerged as the fastest-growing market, with rapid industrialization and increasing demand for CO2 from countries like China and India.

In the UK, key sectors like food and beverage production, healthcare, and industrial manufacturing account for a significant share of CO2 consumption. While North America leads in volume and production, the UK’s market share is likely to remain steady, with a focus on specialized applications such as enhanced oil recovery (EOR), food preservation, and carbon capture technologies.

Key Trends in the United Kingdom Carbon Dioxide Market

Rising Demand from the Food and Beverage Industry: The food and beverage sector remains one of the largest consumers of CO2. Carbon dioxide is widely used in carbonation processes for soft drinks, alcoholic beverages, and sparkling water. Additionally, it is used in meat preservation and modified atmosphere packaging, which helps extend the shelf life of perishable goods. This ongoing demand for CO2 is a primary driver of market growth.

Carbon Capture and Storage (CCS) Technologies: With the UK government pushing for carbon neutrality by 2050, there is an increasing emphasis on carbon capture and storage technologies. CCS technologies involve capturing CO2 emissions from industrial processes and storing them underground to prevent their release into the atmosphere. This innovation will lead to a rising demand for CO2, which could be captured from various sources, including power plants and manufacturing facilities.

Use of CO2 in Enhanced Oil Recovery (EOR): CO2 is also used in enhanced oil recovery techniques, particularly in the North Sea’s oil fields. The demand for CO2 in this sector is expected to remain robust as oil companies continue to use CO2 injection methods to increase oil recovery rates.

Focus on Sustainability and Green Technologies: As part of the UK’s efforts to reduce its carbon footprint, there is growing interest in utilizing CO2 in green technologies. CO2 is being used in the production of biofuels, carbonates, and other chemicals, providing a more sustainable alternative to conventional fossil fuel-based processes.

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United Kingdom Carbon Dioxide Market Dynamics & Trends

Market Drivers

Industrial Applications: Carbon dioxide is an essential component in various industrial processes, including chemical manufacturing, food and beverage production, and even welding. As industrial demand for CO2 continues to grow, the UK market will benefit from the expanded use of CO2 in different sectors. Additionally, CO2 is utilized for water treatment processes and refrigeration applications.

Increasing Demand for Carbonated Beverages: With the popularity of soft drinks, sparkling water, and alcoholic beverages, the demand for CO2 in carbonation processes remains high. This trend, particularly in the food and beverage industry, is a key driver of CO2 consumption in the UK.

Adoption of Carbon Capture and Storage (CCS): The UK government’s commitment to achieving net-zero emissions by 2050 has led to significant investments in carbon capture and storage technologies. CO2 captured from industrial processes will be stored underground to reduce the overall carbon footprint. This shift toward CCS technologies presents a long-term opportunity for CO2 suppliers.

Environmental Regulations: As the UK works toward more sustainable industrial practices, increased environmental regulations are driving companies to adopt CO2-efficient technologies and processes. This is beneficial for CO2 suppliers, as it ensures ongoing demand from industries such as energy production, chemicals, and manufacturing.

Market Restraints

High Production and Transportation Costs: One of the primary challenges facing the UK carbon dioxide market is the high production and transportation costs associated with CO2. The production of CO2 often requires energy-intensive processes, which increases costs for companies involved in CO2 production. Additionally, transporting CO2 to different industries can add to these costs, potentially limiting growth.

Competition from Alternative Gases: While CO2 is essential for many applications, alternative gases such as nitrogen and oxygen are increasingly being used in specific industries. For instance, nitrogen is often used in food preservation, while oxygen is used in some medical applications. The availability of these alternatives could limit the growth of CO2 demand in certain sectors.

United Kingdom Carbon Dioxide Market Opportunities and Challenges

Opportunities

Expansion of Carbon Capture and Storage (CCS): As the UK targets net-zero emissions by 2050, CCS presents a key opportunity for the carbon dioxide market. Companies involved in capturing CO2 emissions from industrial sources will play a significant role in shaping the future of the CO2 market. This offers significant opportunities for innovation in CO2 capture and storage technologies.

Green CO2 Applications: Emerging applications for CO2 in the production of biofuels, chemicals, and green energy technologies provide exciting opportunities for market growth. CO2 can be used as a raw material to produce sustainable products, such as bioethanol and other bio-based chemicals, thus contributing to the development of a circular economy.

Increased Use in Enhanced Oil Recovery (EOR): The demand for CO2 in enhanced oil recovery is expected to remain high in the UK’s North Sea oil fields. EOR techniques, which use CO2 injection to increase oil extraction efficiency, provide an important market for CO2 producers.

Challenges

Government Regulations on Carbon Emissions: The UK government’s goal of reducing carbon emissions could result in stricter regulations on the use of CO2 in certain industries. While CO2 will continue to be necessary in some applications, companies may face increased regulatory scrutiny, which could hinder market expansion.

Fluctuating CO2 Supply: The availability of CO2 is subject to fluctuations in production capacity and the demand-supply balance. In particular, the production of CO2 as a byproduct of industrial processes, such as ammonia production or ethanol production, may be influenced by shifts in other industries, potentially leading to supply disruptions or price volatility.

Competitor Analysis

The United Kingdom carbon dioxide market is competitive, with several established players vying for market share. These include large multinational corporations with a strong presence in the industrial gas sector, as well as companies specializing in sustainable CO2 applications.