UK Earmarks GBP 600 million for Green Steel

The UK Chancellor Jeremy Hunt is expected to announce funds for British steelmakers to transition to #GreenSteel. After consolidation, the UK steel industry is basically made up of two players: British Steel and Tata Steel UK. Under the scheme, each will receive GBP 300 million to incentivize #GreenManufacturing.

The money will support their plans to upgrade the highly polluting coal-fired blast furnaces. It is estimated that to produce one tonne of steel, the coal-fired furnace will emit 1.7 tonnes of carbon dioxide. Across Europe, steel producers accounts for 25% of industrial emissions. To reduce the carbon footprint of steelmaking=, steel smelters can move to Electric Arc Furnaces or use clean fuels such as Hydrogen.

Despite its name, British Steel is now owned by Chinese firm Jingye Group while Tata Steel UK is part of the Indian conglomerate Tata Group. Both have announced to close down their steel plants in the face of rising costs and more stringent emissions standards aimed at fighting #ClimateChange.

However, industry experts point out that the money on the table might not be sufficient since the total costs of switching to Green Steel runs into the billions of pounds. Negotiations are ongoing and the UK Department for Business, Energy and Industrial Strategy declared that it is working closely with the steel industry to secure “a sustainable and competitive future.”