"UK steel producers pay up to 50% more than competitors in France and Germany, adding £37 million to UK steel electricity costs," says a new report from trade organisation, UK Steel.
The report, Industrial Electricity Prices – A barrier to growth, competitiveness, and profitability, highlights the sizable gap that remains between what UK steelmakers and their European competitors pay and sets out three recommendations to bring electricity prices in line with European counterparts:
1. Compensate industry for 90% of its network charges, matching French/German support levels
2. Undertake wholesale market reforms and discount locational pricing models
3. Track industrial energy price disparities between countries
Commenting on the report, UK Steel Director General, Gareth Stace, said: “This new Government has already set out its willingness to deliver for the steel industry, and it now has the opportunity to bring industrial electricity prices in line with our competitors.
“For too long, the UK steel industry has been crippled by high industrial electricity prices, placing a heavy burden on the industry’s competitiveness, profitability, and ability to invest in future growth."
He continued: "The average price faced by UK steelmakers for 2024/25 is £66 per MWh compared to the French price of £43/MWh and the German £50/MWh. That’s a price gap of up to £22/MWh, meaning we pay £37-50 million more for our electricity this year than our European competitors.
“Steel is integral to the new Government’s ambitions for the UK, from the renewable energy rollout through GB Energy to infrastructure developments and increased housebuilding, which all require and rely on steel.
He finished: "Lower power prices are crucial to unlocking the success of the UK Steel industry, enabling steel to be the backbone of a strong and thriving British economy."
Follow us on social media
Categories
For further information