While the UK’s chemical industry continues to innovate and push boundaries, many organisations working in the sector are facing significant pressure on multiple fronts.
The latest survey from the country’s Chemical Industry Association (CIA) cited increased energy costs and the increased price of raw materials, alongside a pause to decisions about future investments and trades as the biggest challenges.
All of these issues have been exacerbated by America’s war with Iran, but the sector was already facing increased pressure due to Brexit and energy costs that are higher than many overseas competitors.
However, one of the sectors that the chemical industry supports is the transition to renewable energy and transport, such as electric vehicles (EVs), as materials derived through toll processing are used in the production of both EV batteries and other renewable energy products like solar panels.
The latest statistics from the Department for Transport indicate that the number of zero emission vehicles registered in the UK has increased by 24 per cent between 2024 and 2025.
What’s more, the number of EVs registered on the UK’s roads exceeded two million for the first time. The figures released recently take us to the end of 2025 and the ongoing increases in fuel prices give us every reason to expect that more people will make the switch.
This highlights the importance of the UK’s chemicals sector in supporting more low and zero-emission vehicles to be produced and make it onto our roads.
CIA members are calling on the government to do more to support the industry, such as by making changes to its policies around energy prices for the sector, the carbon reduction timeline and the regulatory framework that will enable greater growth and investment.
With the drive to improve energy security in the country following the shocks caused by the war with Iran, there could also be an increased demand for other renewable energy technologies, all of which the contract processing sector supports.