The Institute for Energy Economics and Financial Analysis (IEEFA) has stated that the crisis at UK-based steelmaker British Steel’s Scunthorpe plant could be an opportunity. There have been concerns about the prospects of the UK becoming the only G7 country without the ability to make primary steel - steel made from iron ore - and relying solely on electric arc furnaces (EAF). However, the IEEFA noted that, played the right way, the UK can embrace technology transition away from coal-consuming and highly polluting blast furnaces and lay the ground for a modern, low-emissions steel industry fit to compete in a decarbonizing world.
The UK government has taken control of British Steel to prevent the closure of the two blast furnaces at its Scunthorpe plant and consequently the end of primary steel production in the UK, as SteelOrbis previously reported.
Noting that the ideas that only a limited number of steel products can be produced by recycling scrap steel in electric arc furnaces and that the UK cannot decarbonize its steel industry without building direct reduced iron (DRI) plants are increasingly outdated, the IEEFA highlighted that the UK has an alternative; instead of producing iron via DRI domestically, it can base its steel industry on modern EAFs and import iron where clean power is already available and affordable.