United Kingdom Carbon Dioxide Market Trends, Growth, and Opportunities (2025-2034)

The United Kingdom carbon dioxide 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 growth is driven by the increasing demand for CO₂ in a wide range of industries, including food and beverages, medical applications, and metal fabrication. The adoption of sustainable production methods and advancements in carbon capture technologies will also play a crucial role in the market's development.

In this blog post, we explore the key segments of the United Kingdom carbon dioxide market, assess its production dynamics, and highlight the role of leading companies shaping the industry.

Key Market Segmentation by Source

Ammonia

Ammonia production is a primary source of CO₂ in the United Kingdom carbon dioxide market. CO₂ is a by-product of ammonia manufacturing, making it a significant source for industries requiring food-grade carbon dioxide. Companies like Yara International ASA and Tata Chemicals Europe Limited are investing in advanced recovery systems to enhance CO₂ capture and ensure a sustainable supply.

Ethyl Alcohol

The fermentation of ethyl alcohol also produces substantial amounts of CO₂, particularly in the food and beverage industry. Bio-based CO₂ from this source is gaining popularity as a cleaner, more sustainable alternative to fossil-fuel-derived carbon dioxide. Companies such as BioCarbonics Ltd. are focusing on utilizing bio-based production methods to meet growing industry demand in the United Kingdom carbon dioxide market.

Substitute Natural Gas (SNG)

Substitute Natural Gas (SNG) processes contribute to the CO₂ supply in the UK, particularly for industrial applications. Companies like BOC Limited (Linde) are developing innovative solutions to capture CO₂ efficiently from SNG processes, helping reduce emissions while maintaining a steady CO₂ supply for the market.

Market Segmentation by Production

Biological Production

Biological CO₂ production methods, such as fermentation and anaerobic digestion, are gaining traction in the United Kingdom carbon dioxide market. These processes align with the UK’s sustainability goals, offering a more eco-friendly option compared to traditional combustion methods. Companies like Ensus UK Limited are at the forefront of utilizing bioethanol production for biological CO₂ generation.

Combustion Production

Combustion remains one of the most common methods of CO₂ production. However, it poses challenges in terms of emissions. Companies like Air Liquide UK Ltd and Air Products PLC are addressing these concerns by investing in carbon capture, utilization, and storage (CCUS) technologies, allowing them to maintain the efficiency of combustion processes while minimizing environmental impact.

Key Market Segmentation by End Use

Food and Beverages

The food and beverages industry is one of the largest consumers of CO₂ in the United Kingdom carbon dioxide market. Carbon dioxide is used for carbonating beverages, food preservation, and packaging. With the growing demand for carbonated drinks and processed foods, companies like BioCarbonics Ltd. and BOC Limited (Linde) are enhancing their CO₂ supply chains to cater to this expanding sector.

Oil and Gas

In the oil and gas sector, CO₂ is widely used for enhanced oil recovery (EOR). Although the UK is gradually transitioning to renewable energy, EOR applications remain significant in extending the life of existing oil fields. Companies like Air Products PLC continue to support this segment by providing high-quality CO₂ for industrial processes.

Medical Applications

CO₂ is essential in the medical field for various applications such as surgeries, respiratory therapies, and anesthesiology. The growing healthcare sector in the UK is expected to drive increased demand for medical-grade CO₂. Nippon Gases and Progases (UK) Ltd are leading suppliers of medical CO₂, ensuring that the industry maintains high safety standards.

Metal Fabrication

In metal fabrication, CO₂ is used in processes such as welding and cutting. As manufacturing in sectors like automotive and construction continues to grow, companies like Tata Chemicals Europe Limited and Air Liquide UK Ltd are expanding their CO₂ offerings to meet the increasing demand from this industry.

Other Applications

CO₂ also has numerous other applications, including in chemical production, fire suppression systems, and water treatment. These diverse applications help maintain a steady demand across various industries in the United Kingdom carbon dioxide market.

Market Dynamics

SWOT Analysis

Strengths

• Well-established infrastructure for CO₂ production and distribution in the United Kingdom carbon dioxide market.
• Strong presence of leading players offering diverse CO₂ solutions.
• Rising demand across multiple industries, including food and beverages, medical, and industrial applications.

Weaknesses

• Dependence on a few primary sources like ammonia and ethyl alcohol for CO₂ production.
• Environmental concerns associated with traditional combustion-based CO₂ production methods.

Opportunities

• Technological advancements in carbon capture and utilization (CCU).
• Growing interest in bio-based CO₂ production methods, particularly from sustainable sources.
• Increased focus on sustainability and the circular economy, presenting opportunities for green CO₂ solutions.

Threats

• Regulatory pressures related to CO₂ emissions and production.
• Supply chain disruptions due to global economic factors.
• Competition from alternative gases and production methods.

Porter’s Five Forces Analysis

• Threat of New Entrants: High capital investment and stringent regulations create barriers to entry in the United Kingdom carbon dioxide market.
• Bargaining Power of Suppliers: Limited CO₂ sources give suppliers moderate bargaining power.
• Bargaining Power of Buyers: Buyers have access to multiple suppliers but require high-quality and reliable CO₂ delivery.
• Threat of Substitutes: Alternatives to CO₂ in specific applications may pose a threat over time.
• Industry Rivalry: Intense competition among established players drives continuous innovation and cost competitiveness.

Regional Insights

The demand for CO₂ is concentrated in urban centers such as London, Manchester, and Birmingham, where industrial activities are prevalent. However, there is also growth in rural areas as industries expand beyond metropolitan centers. Companies like BOC Limited (Linde) and Air Liquide UK Ltd are optimizing their supply chains to manage regional demands and production effectively.

Competitive Landscape

Several major players are driving growth in the United Kingdom carbon dioxide market. Leading companies include:

• Ensus UK Limited: Focuses on bioethanol production, contributing significantly to biological CO₂ generation.
• BioCarbonics Ltd.: Specializes in bio-based CO₂ solutions, primarily for the food and beverage sector.
• Tata Chemicals Europe Limited: Provides CO₂ for a variety of applications, including metal fabrication and industrial processes.
• Yara International ASA: A leader in ammonia-based CO₂ production with advanced recovery technologies.
• Air Products PLC: Invests in carbon capture technologies and supports EOR processes in the oil and gas industry.
• BOC Limited (Linde): Offers a range of CO₂ solutions for both industrial and medical applications.
• Air Liquide UK Ltd: Focuses on sustainable CO₂ production and distribution, investing in CCU technologies.
• Nippon Gases: Supplies high-quality CO₂ for medical and industrial sectors.
• Progases (UK) Ltd: Provides CO₂ to meet specific industry needs, ensuring consistent supply and quality.