By Paul Homewood
From GWPF:
The demands come as 25,000 jobs hang in the balance with British Steel last week being placed in compulsory liquidation and put in the hands of the Official Receiver.
Energy costs faced by Britain’s steel makers are some of the highest in Europe, with the industry paying twice as much for power as competitors in France and 50pc more than those in Germany.
According to data from trade body UK Steel, British steel companies pay £65.07 per megawatt/hour (MWh) for power, compared with £30.92 for rivals in France and £43.11 in Germany.
Speaking as British Steel collapsed, Greg Clark, the Business Secretary, pledged to “pursue remorselessly every possible step to secure the future” of the company.
Now major players in the sector are challenging Government to come good on these promises by reducing power costs, which are driven up by policies such as decarbonisation initiatives.
They also say tax policies which discourage investment to improve facilities need to be re-examined, as the companies face higher business rates if the pump money into steelworks.
Insiders says that without action, British Steel could be a warning of the future faced by the wider industry.
Luis Sanz, chief executive of Celsa, said the company’s Cardiff plant has one of the most energy efficient furnaces in Europe.
However, he warned: “No amount of energy efficiency can make up for the gap in the unit cost of electricity.”
Steel making in the UK has “every reason to expect a vibrant future”, Mr Sanz said, “once the right business environment is constructed to compete on a level playing field”.
The view was echoed by Tata Steel UK. Deirdre Fox, its director of strategic business development, said that UK steel makers are at an “immediate disadvantage” to rivals in Europe.
“This is a disadvantage which could be changed and would allow the UK sector to attract international investment rather than watching it go to markets with more favourable conditions.”
Full story
Meanwhile, steelmakers in the rest of Europe seem to be faring little better as EUROFER report:
Against the backdrop of the EU elections the European Steel Association calls for urgent action by EU policy makers to help the sector as it faces down the flood of steel exports deflected to the EU because of the US’ imposition of steel import tariffs in 2018.
EUROFER also calls on EU policy makers to meet with them urgently to discuss how to end the crisis. Mr Axel Eggert, Director General of EUROFER said that
“There has been a sudden and markedly negative shift in the prospects of the European steel industry in recent months – and the terrible consequences are plain to see. We have seen announcements of actual or potential plant closures in several EU member states over the past few weeks. The bill of direct jobs immediately at risk exceeds 10,000. Given the EU steel industry’s multiplier effect, the loss of indirect employment in the supply chain could top 100,000.”
Global overcapacity is the principle underlying factor of the present crisis but the direct cause is the vast flood of exports targeting the EU market. Imports rose 12% to nearly 30 million tonnes in 2018 in the wake of the imposition of the US’ section 232 steel tariffs. High and volatile raw material prices, slowing demand in downstream sectors, sharply higher carbon costs five times higher than at the beginning of 2018 and borne by EU steel producers but not by imports of steel into the EU and faltering EU economic performance have also increasingly squeezed the sector in recent months.
via NOT A LOT OF PEOPLE KNOW THAT
May 28, 2019 at 12:21PM
Iowa Climate Science Education 