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The UK steel industry faces more than £150 million annual costs, based on a gradual, gradual, gradual plan to allow manufacturers to release greenhouse gases for free. I’m warning.
The minister plans to abolish carbon allowances for more than a decade starting in 2027, calling the sector “earthquake moment.”
UK Steel, an industrial and trade lobby group, told the minister that the sector will be 167 million pounds higher in response to carbon prices, depending on the sector’s price of £167 million (expected end of the gradual out period) by 2037. It warns you that you may face the challenge.
This predictor has shifted to two largest producers in the country moving to low-pollution electric furnaces and an industry that produces around 7 million tonnes of steel per year.
“Our biggest concern is about the fact that the government is removing free allocations and the number of free allocations you receive. That will have a huge impact on the costs we are facing. “British steel.
“If the free allocation is removed, it will be an absolute earthquake moment for the industry,” he added.
The government is discussing a plan to remove free carbon allowances for industries under the Emissions Trading Scheme (ETS) as part of its plan to introduce carbon border taxes from 2027. The discussions will end on March 10th.
The UK’s most energy-intensive producers now receive a certain amount of quota for free under the government’s ETS, allowing them to compete with rivals based in countries with weak climate mitigation policies.
The UK’s steel industry is under pressure to reduce its carbon footprint to help the UK meet its net zero emissions pledge by 2050. Tata Steel UK, which owns South Wales’ vast Port Talbot site, closed part of the remaining two blast furnaces last year. of government-supported deals to build one electric arc furnace. Under the contract, the minister committed £500 million in state aid to the Indian-owned group.
British Steel, which currently operates only the remaining two blast furnaces in the UK, is trapped in consultation with the Minister about ensuring an even greater level of support.
The Chinese-owned group is considering building two small electric furnaces at Lincolnshire’s flagship Scunthorpe Site. The union hopes that the company will continue to operate the explosion furnace during the transition and is lobbying the minister for relief from the associated carbon costs.
Aaskov said that despite the closure and dramatic drops of the last two explosive furnaces, the sector’s overall emissions remain “important” under the new scheme.
He added that some of the manufacturing processes, such as “rolling, reheating, downstream processes,” still emit important carbon.
The industry was not opposed to abolishing it from free allocations, but he said he was “cautious” about what was happening too suddenly about it, claiming that it needed to be managed carefully. .
“There is no Plan B,” Aaskov said, adding “There are a lot of concerns when (carbon border tax) provides protection against leaks.”
The government has introduced a “carbon border adjustment mechanism” to protect industries from unfair competition with regions with low carbon costs.
The government said it would not allow the UK to end steelmaking,” adding that the recently released steel frame strategy consultations will investigate the long-term issues facing the industry. The government was also committed to up to £2.5 billion to rebuild the sector.
The new carbon border tax mechanism states that “insures importers pay fair and equivalent carbon prices to those facing domestic producers, and that decarbonization efforts are not undermined. It gives the industry the confidence to know and invest in the UK.”
