British Steel has announced its plans to shut down its blast furnaces in Scunthorpe and replace them with electric arc furnaces, a move that could put up to 2,000 jobs at risk. The company, owned by China’s Jingye Group, aims to make British Steel a “clean, green and sustainable business” with its £1.25bn proposal. The plans are dependent on support from the UK government. The new furnaces could potentially be operational by late 2025. Unions estimate that the shift could result in the loss of 1,500 to 2,000 jobs, mostly at the Scunthorpe plant. British Steel will work with the local council to attract new business and jobs to the site.
The UK government considers the blast furnaces at Scunthorpe to be economically unviable as they are losing £1m per day and are not environmentally friendly, making them unsustainable in financial and environmental terms. However, this move would leave the UK without the ability to produce virgin steel. The government argues that there is limited demand for this type of steel domestically and that electric arc furnaces can cover most of the UK’s steel needs. While electric arc furnaces cannot produce the same grade of steel as blast furnaces, they have the advantage of being powered by renewable energy sources and are capable of producing stainless and alloyed steels.
Unions have expressed concern over the timeline for this transition and have described the reliance on electric arc furnaces as “dangerous and foolhardy.” They argue that these plans, in combination with Tata Steel’s proposal to close its blast furnaces, would leave the UK vulnerable to international markets and unable to produce steel from raw materials. The unions have threatened industrial action over Tata’s plans and believe that transitioning to zero-carbon steelmaking while protecting jobs is possible, as demonstrated by other countries. The closure of the blast furnaces would have a significant impact on the town of Scunthorpe, which has been home to the steelworks for over five decades. British Steel maintains that it is committed to providing long-term, well-paid careers for its employees and supply chains.
