The future of the UK’s steel industry depends on its ability to decarbonise, which is contingent on competitive electricity prices. Two changes are needed: parity with competitors on network charges and wholesale electricity market reform.
Scrap is a strategic material and will be critical to the steel sector’s Net Zero future. By 2030, UK scrap demand could increase by 70% and global demand by 30%, and this will continue to accelerate into 2050. The UK is fortunate to generate more than 10 million tonnes (Mt) of steel scrap each year.
We are committed to reducing 80% of emissions by 2035 and Net Zero steel production by 2050. Our sector wants to work hand-in-glove with Government to achieve these aims. UK steel must be part of UK decarbonisation. Investment is needed in wide plate steelmaking capability for in wind towers, floating wind and the wider offshore wind supply chain.
The UK boasts some of the best research and innovation expertise, which we must capitalise upon and grasp the opportunity to become global leaders in green steelmaking.
A UK Carbon Border Adjustment Mechanism is now proposed to be implemented in 2027, a year later than when the EU’s CBAM takes effect, exposing our market to trade diversion of high-emissions steel.
The UK must be ready to take a stronger stance on trade remedies, making them more accessible to industry, developing a clear position towards non-market economies and forming alliances with like-minded countries to develop new trade remedies tools that are fit for purpose.
The Government has a hugely powerful tool at its disposal to bolster UK industry and supply chains, while at the same time maximising the social, economic and environmental benefits of public expenditure.