Asked by: Lord West of Spithead (Labour - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask Her Majesty's Government what plans they have to bring forward the Clean Steel Fund, which is due to begin in 2023.
Answered by Lord Callanan - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
As my Rt. Hon. Friend the Secretary of State stated in his evidence to the Business, Energy and Industrial Strategy Select Committee on 20 July 2021, the Government is keen to have a more sustainable, long-term approach to the sector. The Department is continuing to work with the sector through the Steel Council to understand how the industry achieves decarbonisation and what support is appropriate and proportionate to assist with that.
Asked by: Seema Malhotra (Labour (Co-op) - Feltham and Heston)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, when his Department will publish its spending proposals for the Clean Steel Fund.
Answered by Lee Rowley - Minister of State (Minister for Housing)
The Government recognises the vital role that the steel sector pays across the United Kingdom economy. We will continue to work with the sector to support its decarbonisation. Funds such as the Industrial Energy Transformation Fund (IETF) and the Industrial Decarbonisation and Hydrogen Revenue Support (IDHRS) scheme have been announced to support decarbonisation by the Government. Further proposals, including the approach to the Clean Steel Fund, will be brought forward in due course.
Asked by: Stephen Kinnock (Labour - Aberavon)
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.
Answered by Lee Rowley - Minister of State (Minister for Housing)
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.
Asked by: Tim Farron (Liberal Democrat - Westmorland and Lonsdale)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he is taking to fund a clean steel demonstrator project.
Answered by Lee Rowley - Minister of State (Minister for Housing)
The Government recognises the vital role that the sector plays across the UK to benefit our economy. We will continue to work with the sector to support its decarbonisation.
In March 2021, the Government published the Industrial Decarbonisation Strategy in which we committed to working with the Steel Council to consider the implications of the recommendation of the Climate Change Committee to ‘set targets for ore-based steelmaking to reach near-zero emissions by 2035 and the business environment necessary to support the transition. We will provide further information in due course.
Published in October, the Net Zero Strategy committed to provide further support for research and innovation to enable the fuel switch to low carbon hydrogen on industrial sites, such as integrated steelworks. This will be delivered through the Net Zero Innovation Portfolio and initiatives led by the Industrial Decarbonisation Research and Innovation Centre.
Asked by: Baroness Bennett of Manor Castle (Green Party - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask Her Majesty's Government what steps they are taking in developing green, low climate emission steel, substituting hydrogen for coking coal; and when is the first steel from this expected to be delivered.
Answered by Lord Callanan - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
Decarbonising UK industry is a core part of the Government’s ambitious plan for the green industrial revolution. The Industrial Decarbonisation Strategy, published on 17 March, commits Government to work with the Steel Council to consider the implications of the recommendation of the Climate Change Committee to ‘set targets for ore-based steelmaking to reach near-zero emissions by 2035’. The Steel Council offers the forum for Government, industry and trade unions to work in partnership on the shared objective of creating an achievable, long-term plan to support the sector’s transition to a competitive, sustainable and low carbon future. Hydrogen-based steelmaking, Carbon Capture, Utilisation and Storage (CCUS), and electrification are some of the technological approaches being examined as part of this process.
The UK steel sector will be given the opportunity to bid into industrial fuel switching innovation programmes under the £1 billion Net Zero Innovation Portfolio (NZIP), which is intended to promote switching away from more carbon-intensive fuel sources. The Government has also announced a £250 million Clean Steel Fund to support the UK steel sector to transition to lower carbon iron and steel production, through investment in new technologies and processes.
Asked by: Jessica Morden (Labour - Newport East)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what discussions he has had with Cabinet colleagues on the future of the Clean Steel Fund.
Answered by Lee Rowley - Minister of State (Minister for Housing)
My Rt. Hon. Friend the Secretary of State for Business, Energy and Industrial Strategy regularly discusses a range of issues with Cabinet colleagues regarding Net Zero and levelling up, in which the UK steel industry will play a key role.
The Government recognises the vital role that the sector plays in all areas of the UK and our economy and will continue to work with the sector to support its decarbonisation. The Department announced the Clean Steel Fund in 2019 and a number of options have been explored, together with ongoing feedback from industry.
In March 2021, the Government published the Industrial Decarbonisation Strategy in which we committed to working with the Steel Council to consider the implications of the recommendation of the Climate Change Committee to ‘set targets for ore-based steelmaking to reach near-zero emissions by 2035 and the business environment necessary to support the transition. We will provide further information in due course.
Asked by: Gill Furniss (Labour - Sheffield, Brightside and Hillsborough)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will provide a timescale for the allocation of funding under the Clean Steel Fund.
Answered by Lee Rowley - Minister of State (Minister for Housing)
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.
The Government recognises the vital role that the sector plays in all areas of the UK and our economy and will continue to work with the sector to support its decarbonisation. The Department announced the Clean Steel Fund in 2019 and a number of options have been explored, together with ongoing feedback from industry.
In March 2021, the Government published the Industrial Decarbonisation Strategy in which we committed to working with the Steel Council to consider the implications of the recommendation of the Climate Change Committee to ‘set targets for ore-based steelmaking to reach near-zero emissions by 2035 and the business environment necessary to support the transition. We will provide further information in due course.
Asked by: Caroline Lucas (Green Party - Brighton, Pavilion)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he has taken to engage with civil society on the allocation of the Clean Steel Fund.
Answered by Lee Rowley - Minister of State (Minister for Housing)
The Department announced the Clean Steel Fund (CSF) in 2019 and it is currently in development. In 2019 we carried out a Call for Evidence seeking views and supporting evidence to help us develop the detailed design of the Fund, including on barriers to realising clean steel ambitions, and the opportunities to be gained in overcoming these. This Call for Evidence was open to all and we received responses from civil society, including trade associations and academics. These responses are being considered as the policy is designed.
The Government will continue to engage with a range of interested parties on the steel sector in the future.
Asked by: Caroline Lucas (Green Party - Brighton, Pavilion)
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 plans to take to support the decarbonisation of the UK steel industry between now and 2023 ahead of the Clean Steel Fund’s allocation.
Answered by Lee Rowley - Minister of State (Minister for Housing)
The Department announced the Clean Steel Fund (CSF) in 2019 and it is currently being designed and developed.
Other schemes are available to support the steel sector which are live now, including the Industrial Energy Transformation Fund (IETF). Through grant funding, the IETF can support energy efficiency upgrades and decarbonisation engineering studies, which are needed to prepare the sector for more ambitious decarbonisation schemes in the future.
Asked by: Gill Furniss (Labour - Sheffield, Brightside and Hillsborough)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he is taking to encourage inward investment into the UK’s steel sector to aid the transition to net zero carbon emissions.
Answered by Lee Rowley - Minister of State (Minister for Housing)
The Government recognises the importance of the UK steel sector as a foundation industry and the role it plays in the supply chain for other important advanced manufacturing sectors in the UK, as well as for direct and indirect jobs across the country.
Decarbonising the sector is a core part of the Government’s plans to meet its stated carbon emission reduction targets, for supporting local economic growth and for our levelling up agenda.
The Steel Council was reconstituted in March 2021. This forum offers the Government and industry the opportunity to work towards creating an achievable, long-term plan to support the sector’s transition to a competitive, sustainable, and low carbon future.
The Government has announced a £250 million Clean Steel Fund to support the UK’s steel sector to transition to lower carbon iron and steel production, through new technologies and processes, placing the sector on a pathway consistent with the UK Climate Change Act. Our expectation is that the Fund will provide a proportion of the investment for projects, with the rest funded by industry.