The UK-based trade association UK Steel has published a report that examines current electricity prices faced by steelmakers in the UK, France, and Germany, and sets out four recommendations to deliver competitive electricity prices for the UK steel industry.
The association stated that aligning UK electricity prices with European levels is necessary as steel companies such as Tata Steel and British Steel invest in electric arc furnace technology. UK Steel’s analysis shows that UK steel producers typically face an average electricity price in 2023-24 of £113/MWh, compared to the estimated German and French prices of £61/MWh. UK steelmakers are thus currently paying almost twice as much as their nearest competitors, driven by higher network charges in the UK.
Stating that the UK steel industry must have access to competitive electricity prices to maximize investments and reduce emissions, UK Steel recommends the implementation of the British Industry Supercharger package by April 2024, the compensation of the industry for 90 percent of its network charges, matching French/German support levels, wholesale market reforms, and the tracking of industrial energy price disparities between countries.