A government spokesperson said after working with the companies over weeks to understand “the financial challenges they have faced over the past decade”, the government had taken the difficult decision not to offer direct funding “as it would not provide value for the taxpayer or solve the long-term problems the industry faces”.
The government said it recognised this was a “difficult time for the workers and their families” and said it would work with trade unions, local partners and the companies to support those affected.
Bioethanol, a fuel made from wheat, corn or sugar beet, is added to fuels such as E10 petrol in the UK.
Sources within the sector said that government delays over the migration to petrol with higher bioethanol content had hurt the industry.
The government has previously said that by 2030 it wants 10% of all fuel used in planes to come from sustainable sources, one of which is bioethanol.
The bioethanol industry buys thousands of tonnes of wheat from UK farms, and Ensus also produces 30% of the UK’s commercial carbon dioxide – used in soft drinks, medical and nuclear industries.
The government said it would continue to work on measures to ensure the resilience of the CO2 supply chain.