Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps his Department is taking to ensure the Clean Steel Fund is allocated before 2023, in response to successful developments of hydrogen-based steelmaking projects in Sweden and Germany.

The Department announced the £250 million Clean Steel Fund in 2019 to support the UK steel sector to transition to lower carbon iron and steel production, through adoption of new technologies and processes. We are working with the sector to understand their decarbonisation plans, whether it is electric arc, industrial carbon capture equipment attached to existing blast furnaces, or other emerging technologies, such as hydrogen.

Based on previous evidence, complex decarbonisation projects have long lead-in times and take time to set up. In its response to the Call for Evidence on the Clean Steel Fund, the steel industry indicated a preference for the fund to start in 2023.

We have set up the Industrial Decarbonisation and Hydrogen Revenue Support (IDHRS) scheme to fund our new hydrogen and industrial carbon capture business models. We will be providing up to £140 million of taxpayer funds will be made available to establish the scheme, including up to £100 million to award contracts of up to 250MW of electrolytic hydrogen production capacity in 2023 with further allocation in 2024. The scheme will be open to businesses across industry, including steel companies.