A government aid package aimed at securing the long-term future of steelmaking in South Wales could be a “missed opportunity”, a senior Labour MP has told Sky News.
Stephen Kinnock, whose Aberavon constituency includes Port Talbot, home of the steelworks owned by Tata, also said the deal could be counterproductive.
While it does include the building of electric arc furnaces (EAFs) – which are greener than traditional blast furnaces – it does not focus enough on transitioning to a decarbonised economy, Mr Kinnock said.
“Nobody’s really talking about hydrogen (to produce steel), carbon capture and storage,” he said.
Dr Jonathan Aylen, a steel industry expert at the University of Manchester, has similar concerns, describing the potential agreement as a “bit of a stop-gap solution”.
Getting rid of blast furnaces, which use coke derived from coal, would be an important step, however.
While they are a “great way to make steel” they are also a “great producer of carbon”, Dr Aylen told Sky News.
“For every tonne of steel you make you get two tonnes of carbon dioxide going into the atmosphere.”
But he, too, mentioned the use of hydrogen and carbon capture and said ministers need to take a “long, careful, hard look at what needs to be done to decarbonise steel and stop becoming, so to speak, being taken for a sucker by every company that wants a handout”.
For the unions, there are concerns about job cuts, because EAFs use less labour-intensive processes to produce steel than blast furnaces.
The government is “choosing to follow a jobs cuts agenda”, the Unite union has claimed.
Community, the steelworkers’ union, said unions had “not agreed any decarbonisation strategy for Port Talbot”.
There are questions, too, about whether it is worth spending taxpayers’ money to support the steel industry.
Russ Mould, investment director at AJ Bell, said it accounts for a…
