The CO2 shortages are back in the news and it isn’t good news



The first story was from NBC News, dateline August 3rd. The headline, Craft breweries shutting down due to U.S. carbon dioxide shortage. Once that story hit the wire, other news outlets picked it up. I am informing you about this because you may hear a news story about the CO2¬†shortage and it will likely oversimplify the situation. For most news outlets, I suppose that’s fine, but a beer-focused news source should go deeper. I want my readers to have a broader understanding. I also want readers to recognize how some breweries are avoiding the crisis.

The August 3rd NBC News story was focused on one brewery that cited the current CO2 shortage as the reason for its pending closure. On August 4th other news outlets grabbed the story off the wire and gave it their own spin. Here are just three of yesterday’s related headlines from my own news feed:

  • Beer falling flat over nationwide shortage of carbon dioxide
  • Beer Breweries Are Getting Crushed By A Massive Shortage Of One Key Ingredient
  • Carbon dioxide shortage could lead to national beer shortage

Pretty frightening stuff, eh? Yes, in fact, there is a CO2 shortage. It’s a serious problem but it is not necessarily new. The Washington Beer Blog reported on the situation in April 2020, noting that CO2 supplies were short and prices were creeping up. At that time, we noted that prices had already increased by 25 percent.


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Why the Shortage?

The recent spate of stories spawned by that one NBC News story all asserted that the CO2 shortage is due to a contaminated source: Jackson Dome in Mississippi, one of the nation’s largest naturally occurring CO2 sources, which was discovered back in the 1970s. It’s like an aquifer of CO2. Apparently, it is contaminated with sulfur. This is especially bad news for breweries in the Gulf Coast region, which are more reliant on Jackson Dome CO2 than breweries in other parts of the nation.

“The supply of CO2 has remained tight since the shortages in the Spring of 2020,” said a recent report from the Brewers Association, which represents the nation’s small, independent breweries. “Reduced deliveries and force majeures have remained common in various regions throughout the U.S. over the past two years… Even more problematic, a major natural source of CO2, the Jackson Dome area in Mississippi, is facing a contamination issue… This current shortage is most acute in the southeastern and central parts of the country.” 


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The Connection Between Gas and Gas

It’s bad news, for sure, but Jackson Dome is not the primary source of the nation’s CO2. Most food-grade CO2 used by the beer industry, and other industries, is not naturally occurring. Rather, it is a byproduct of industrial processes.

I should point out that the largest breweries have long utilized CO2-capture systems, making use of the CO2 produced by their own processes, so the uber-sized, mega breweries are not impacted by the shortages. With emerging technology, there are now smaller systems available and some breweries are utilizing such systems. (I talk a bit more about CO2-capture systems at the end of this story.)


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Two key sources of CO2 are ammonia production and ethanol production. When ammonia and ethanol are produced, CO2 is captured and used for many purposes and products, like beer. In recent years, the production of both ammonia and ethanol has fallen. Thus, a CO2 shortage.

Let’s just focus on ethanol, which is a key ingredient in gasoline. When less gasoline is produced, less ethanol is used. When less ethanol is produced, less CO2 is produced. When the pandemic hit, people parked their cars and stayed at home. Gasoline consumption dropped massively. Oil companies responded by reducing production. They even shuttered some facilities entirely. Less gasoline production, less ethanol production, and less CO2 production.

Now that things are back to normal, or something closer to normal, we are all driving our cars again. Oil companies have been slow to ramp production back up to pre-pandemic levels. Some folks, including some members of Congress, suggest that oil companies are intentionally dragging their feet, keeping demand high and supply low in order to keep gas prices high and keep their profits at record levels, as they’ve been lately. I’ve heard it called “greedflation.”

Anyway, I digress. The fact is, yes the problem at Jackson Dome is adding to an already problematic situation, but that is just one part of the story. Hopefully, CO2 production returns to normal levels in the near future. The world is still struggling to recover from the pandemic and this is just one of the effects. There are other force majeures at work, like the energy crisis created by the war in Ukraine. It’s messy.

The mantra, “If it bleeds, it leads,” suggests that a story about a brewery going out of business will capture people’s attention better than a story about a brewery that is prospering in the face of challenges and uncertainty. No sense in researching too deeply into the reasons behind the CO2¬†shortage, no sense in mentioning that there are 10,271 breweries in the USA that are not going out of business due to the CO2¬†shortage, but if it bleeds, it leads.

The Bright Side

Some breweries are taking advantage of ways to capture their own CO2. After all, CO2 is a byproduct of fermentation. Until recent years, these capture systems were only used by the largest breweries, but that’s changed and there are now system appropriate for smaller craft breweries.

One brewery taking advantage of the new technology is Icicle Brewing in Leavenworth, Washington. I did a Zoom-style interview with the folks at Icicle Brewing during the lockdowns. We talked about the new CO2-capture technology. You can watch that interview below or see it on YouTube.

Jump to the 23-minute mark if you want to hear just the CO2 part of the conversation. You can also read more about these systems in a story we published back in 2019.



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