- INEOS Acetyls in Hull slashes emissions by 75% and now faces a £23 million penalty in withheld carbon credits
- UK Government must decide: does it want to back British manufacturing to lead on decarbonisation or push it offshore?
INEOS Acetyls has completed a pioneering, world-first investment at its Hull site, to switch its fuel source from natural gas to low-carbon hydrogen. The result is a 75% reduction in emissions, which is the equivalent of taking 160,000 cars off UK roads.
This project places the Hull site on a clear path to becoming the world’s first Net Zero producer of Acetic Acid, which is a critical building block used in food production, pharmaceuticals, synthetic fibres and specialty chemicals.
It’s exactly the kind of green industrial leadership the UK Government claims it wants.
And yet, the Environment Agency is now threatening to reclassify the Hull site, which has been operating since the 1930s, as a “new installation” simply because it switched to a cleaner fuel source. This re-categorisation would mean the site will not receive its UK Emissions Trading Scheme (ETS) allowances until 2028.
The impact? A £23 million cash drain over the next three years, imposed on a site that is already loss-making, at a time when it is also under threat from cheaper, higher-carbon imports from countries such as China, whose emissions per tonne of acetic acid are eight times higher than the UK’s.
This is a prime example of regulatory madness, penalising those who invest in decarbonisation and setting a dangerous precedent for industry.
CEO David Brooks said: “It’s bonkers. We’re being punished for doing the right thing. We’ve invested to slash emissions, and in return the government wants to ‘re-categorise’ our site—leaving us over £23 million worse off in the next couple of years. It sends entirely the wrong message.”
“This is yet another example of the UK Government, through red tape and misguided regulation, pushing industry offshore. While countries like China and the US back their manufacturers, Britain penalises them for cutting emissions. It’s perverse—and it’s costing us investment, jobs, and our industrial future.”
INEOS is calling for a simple, cost-neutral fix: allow the Hull site to receive its 2026 and 2027 ETS free allocations on the normal in-year timeline, just like every other eligible site across the UK. This is not a request for additional credit, just for what is already due to be delivered when it is needed.
This decision is a litmus test for the UK’s credibility as a home for clean industrial investment. Get it right, and the UK can lead. Get it wrong, and the message is clear: “Industrial investment not welcome here.”
ENDS.
INEOS Agency: ineos@firstlightgroup.io | +44 20 7193 9030
Richard Longden, INEOS | richard.longden@ineos.com | +41 79 962 61 23