10-07-2025
British biofuel factory undercut by US rivals faces closure
Adam Traeger, Greenergy's chief executive, said that cost cuts at its biodiesel plant aimed at improving profitability had failed to offset the impact of the US imports, which are heavily subsidised by Washington and no longer subject to an import duty following Brexit.
He said a slower ramp-up in the UK's biofuels blending mandates – currently set at 14pc – compared with other European countries was also impacting production and making it impossible to commit to the investment needed to make Immingham competitive.
The fuel rules are meant to lessen the emissions of transport by blending propellant with less environmentally damaging substitutes.
Mr Traeger said: 'It has been an incredibly difficult decision to enter consultation on the proposed closure of our Immingham site. However, in light of continuing market pressures, we unfortunately do not have enough certainty on the outlook.'
It comes after Argent Energy last year announced the closure of its Motherwell biodiesel plant in Scotland, citing the saturation of the market with Chinese imports.
Greenergy will seek talks with ministers on increasing the proportion of biofuel used in the petrol and diesel supplied on UK forecourts, something it said could help protect the sector while also reducing carbon emissions from HGVs.
At the same time, it said it would begin consultation on the plant's closure with affected employees as soon as possible.
The Immingham site began production in 2007 and accounts for more than a quarter of UK biodiesel production, processing waste oils sourced globally to make it ready for blending.
Greenergy, which has been part of Singapore-based commodities trading giant Trafigura since August, also operates a biodiesel plant on Teesside, plus a third in the Netherlands.
The firm said high energy and chemicals prices combined with a flood of hydro-treated vegetable oils imported from the US had put pressure on margins to an extent that some even turned negative in certain scenarios.
While the Trade Remedies Authority has begun an investigation into the situation it may take a further 12 months to reach a decision.
UK policy designed to encourage a switch to biofuels has meanwhile fallen behind measures imposed in EU countries such as Germany, the Netherlands and Ireland, where it is estimated that 2030 mandates will be more than double those of the UK.
