Asked by: Paul Maynard (Conservative - Blackpool North and Cleveleys)
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 increase Government-backed research into the domestic manufacture of decarbonised steel.
Answered by Nadhim Zahawi
The Government recognises the importance of research and development in helping to transform the steel sector so that it can play a vital role in developing a cleaner, greener economy in the UK. We have taken a number of steps to facilitate the decarbonisation of steel making in the UK, including;
Firstly, a £315 million Industrial Energy Transformation Fund which aims to support businesses with high energy use to cut their bills and reduce carbon emissions.
Secondly, providing up to £66m through the Industrial Strategy Challenge Fund to help steel and other foundation industries develop radical new technologies and establish innovation centres of excellence in these sectors.
Thirdly, establishing a £250m Clean Steel Fund that will support the decarbonisation of the steel sector, supporting its transition to new low carbon technologies and processes. The Government also plans to establish a Net Zero Hydrogen Fund (previously Low Carbon Hydrogen Production Fund): with £240m of capital co-investment out to 2024/25. This will support at-scale production from both Carbon Capture Usage and Storage (CCUS) enabled (‘blue’) hydrogen and electrolytic (‘green’) hydrogen projects.
Finally, as part of the Spring 2020 Budget, the Chancellor announced £22m (subject to a business case) for the Materials Processing Institute in Teesside to deliver a R&D programme of transformation manufacturing - to help UK steel and metals sector improve efficiencies, slash emissions and ultimately boost global competitive edge.
Asked by: Matthew Pennycook (Labour - Greenwich and Woolwich)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, when he plans to implement the Clean Steel Fund.
Answered by Nadhim Zahawi
In August 2019, the Government 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. The Fund will help the sector towards achieving our target of net zero emissions by 2050, by maximising longevity and resilience while harnessing clean growth opportunities.
Steel industry stakeholders provided positive responses to our Call for Evidence, including responses on possible timelines for the Fund. Feedback generally indicated that companies could be ready with projects for funding by 2023 or 2024. A summary of the responses was published in December 2020. Officials will work with industry to decide the most appropriate timeline for the scheme.
Asked by: Bill Esterson (Labour - Sefton Central)
Question to the Department for Environment, Food and Rural Affairs:
To ask the Secretary of State for Environment, Food and Rural Affairs, what assessment his Department has made of the environmental benefits of utilising more of the scrap steel produced in the UK each year.
Answered by Rebecca Pow - Parliamentary Under-Secretary (Department for Environment, Food and Rural Affairs)
Some ten million tonnes of scrap metal is processed into secondary raw material in the UK each year. A proportion of this is collected through the Waste Electronic and Electrical Equipment (WEEE) Regulations and End of Life Vehicles Regulations schemes. As scrap metals have a commercial value, the market determines where this material will go.
The Government has commissioned research to understand the economic, environmental and social opportunities of scrap metal, particularly steel. The results of this research will be published shortly.
Additionally, in August 2019, the Government 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. The Fund will help the sector towards achieving our target of net zero emissions by 2050, by maximising longevity and resilience while harnessing clean growth opportunities. Dependent on company business plans, this could include supporting the sector to replace carbon intensive blast furnace production with electric arc furnaces that would utilise UK scrap.
Asked by: Patrick Grady (Scottish National Party - Glasgow North)
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 publish a response to Early Day Motion 1335, COP26 and deep coal mining in the UK.
Answered by Anne-Marie Trevelyan - Minister of State (Foreign, Commonwealth and Development Office)
The UK is a global leader in the fight against climate change: since 1990 emissions from the electricity sector have decreased by 72%, while the economy has grown by two thirds. The UK was the first major economy in the world to set a legally binding target to achieve Net Zero greenhouse gas emissions by 2050.
In line with our Net Zero target, the Government has committed to phasing out unabated coal-fired power generation by 2025, and is consulting on moving this date forward to 2024. The UK has already made great progress in decarbonising its energy system, with coal’s share of electricity generation falling from 40% in 2012 to less than 3% in 2019. The UK Government has also shown strong leadership internationally on the shift from coal power generation to clean energy. We co-launched the Powering Past Coal Alliance with Canada, which has now grown to over 100 members and is leading the COP26 Energy Transition campaign to accelerate the global transition to clean energy. The Government have also announced that we will no longer provide any new direct government support for the fossil fuel energy sector overseas.
The planning application for the Whitehaven coal mine relates to metallurgical (coking) coal, rather than coal for electricity generation, and the Government recognises that some industrial processes, including steel production, are particularly difficult to decarbonise as there is currently no commercially viable alternative to coal in blast furnaces. Our priority is supporting innovation to help carbon-intensive industries to decarbonise further. We are taking steps to achieve this through initiatives such as the Industrial Energy Transformation Fund, the Industrial Clusters Mission and the Clean Steel Fund. In addition, ahead of COP26, we are working in partnership with other countries to accelerate the pace of industrial decarbonisation, which includes the steel sector. The UK is coordinating action on the research, development and demonstration of new low carbon technologies with other countries, as well as exploring policy options for creating international markets for low carbon industrial products.
Planning decisions are made at a local level and this application is a matter for Cumbria County Council.
Asked by: Matthew Pennycook (Labour - Greenwich and Woolwich)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what progress he has made on implementing the Clean Steel Fund.
Answered by Nadhim Zahawi
In August 2019, the Government 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. The Fund will help the sector towards achieving our target of net zero emissions by 2050, by maximising longevity and resilience while harnessing clean growth opportunities.
Steel industry stakeholders provided positive responses to our Call for Evidence. A summary of the responses was published in December 2020 and will inform the scheme’s design. As we develop the Fund, we will continue to engage closely with the sector to ensure that it meets the needs of businesses.
Asked by: Chris Green (Conservative - Bolton West)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what recent assessment he has made of the (a) competitiveness of electricity prices in the UK and (b) effect of those prices on the UK steel sector’s ability to compete internationally.
Answered by Nadhim Zahawi
The Government is committed to minimising energy costs for businesses to ensure our economy remains strong and competitive. The ability for our industries to be able to compete across Europe and globally is a priority for this Government.
The Government has put moving to a cleaner, greener economy at the heart of its Industrial Strategy, especially with our commitment to Net Zero. Our aim is to work with the steel sector and help them to reduce carbon emissions. We will continue to support the steel sector in achieving these aims through the various funds available such as the Industrial Energy Transformation Fund and Clean Steel Fund.
We estimate that reduction in the various renewable costs for eligible energy intensive industries, including steel, will save them around £400m a year in electricity costs. We have also extended the schemes to compensate certain energy intensive industries for indirect emission cost to the end of the next financial year in order to minimise disruption to existing recipients whilst we conduct a review. Between 2013 and 2019, total compensation paid to the steel sector was over £480m.
We welcome the recent report by UK Steel - “Closing the Gap” - regarding electricity prices and will give its recommendations careful consideration.
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 monitoring of the gap in industrial energy prices between the UK and other key nations.
Answered by Anne-Marie Trevelyan - Minister of State (Foreign, Commonwealth and Development Office)
My Rt. Hon. Friend the Secretary of State has regular meetings with Cabinet colleagues on a variety of issues.
The Government is committed to minimising energy costs for businesses to ensure our economy remains strong and competitive. The ability for our industries to be able to compete across Europe and globally is a priority for this Government.
Our aim is to work with the steel sector and help them to reduce carbon emissions. We will continue to support the steel sector in achieving these aims through the various funds available such as the Industrial Energy Transformation Fund and Clean Steel Fund.
We estimate that reduction in the various renewable costs for eligible energy intensive industries, including steel, will save them around £400m a year in electricity costs. We have also extended the schemes to compensate certain energy intensive industries for indirect emission cost to the end of the next financial year in order to minimise disruption to existing recipients whilst we conduct a review. Between 2013 and 2019, total compensation paid to the steel sector was over £480m.
Asked by: Holly Mumby-Croft (Conservative - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what recent discussions he has had with Cabinet colleagues on monitoring of the difference in industrial energy prices between the UK and other countries.
Answered by Anne-Marie Trevelyan - Minister of State (Foreign, Commonwealth and Development Office)
My Rt. Hon. Friend the Secretary of State has regular meetings with Cabinet colleagues on a variety of issues.
The Government is committed to minimising energy costs for businesses to ensure our economy remains strong and competitive. The ability for our industries to be able to compete across Europe and globally is a priority for this Government.
Our aim is to work with the steel sector and help them to reduce carbon emissions. We will continue to support the steel sector in achieving these aims through the various funds available such as the Industrial Energy Transformation Fund and Clean Steel Fund.
We estimate that reduction in the various renewable costs for eligible energy intensive industries, including steel, will save them around £400m a year in electricity costs. We have also extended the schemes to compensate certain energy intensive industries for indirect emission costs to the end of the next financial year in order to minimise disruption to existing recipients whilst we conduct a review. Between 2013 and 2019, total compensation paid to the steel sector was over £480m.
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 assessment he has made of the implications for his policies of the UK steel sector’s commitment to increase capital investment in the UK in the event that the Government takes steps to ensure that electricity costs are competitive.
Answered by Nadhim Zahawi
The Government is committed to minimising energy costs for businesses to ensure our economy remains strong and competitive. The ability for our industries to be able to compete across Europe and globally is a priority for this Government.
Our aim is to work with the steel sector and help them to reduce carbon emissions. We will continue to support the steel sector in achieving these aims through the various funds available such as the Industrial Energy Transformation Fund and Clean Steel Fund.
We estimate that the reduction in the various renewable policy costs for eligible energy intensive industries, including steel, will save them around £400m a year in electricity costs. Between 2013 and 2019, total compensation paid to the steel sector was over £480m.
We have also extended compensation for the indirect emission costs in electricity prices for the most energy-intensive companies at significant risk of carbon leakage by a year, to the end of 2021.
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 steps he plans to take to ensure that electricity costs for the UK steel sector are competitive.
Answered by Nadhim Zahawi
The Government is committed to minimising energy costs for businesses to ensure our economy remains strong and competitive. The ability for our industries to be able to compete across Europe and globally is a priority for this Government.
Our aim is to work with the steel sector and help them to reduce carbon emissions. We will continue to support the steel sector in achieving these aims through the various funds available such as the Industrial Energy Transformation Fund and Clean Steel Fund.
We estimate that the reduction in the various renewable policy costs for eligible energy intensive industries, including steel, will save them around £400m a year in electricity costs. Between 2013 and 2019, total compensation paid to the steel sector was over £480m.
We have also extended compensation for the indirect emission costs in electricity prices for the most energy-intensive companies at significant risk of carbon leakage by a year, to the end of 2021.