Tata Steel pact with National Grid for energy supply to electric arc furnaces

TATA Steel has reached a deal with the UK’s electricity grid to supply power for new furnaces in south Wales from 2027, as it plans to install electric arc furnaces at its Port Talbot plant, The Guardian reports.

As per the agreement, the National Grid’s electricity supply operator will provide hundreds of megawatts of power to the new environment-friendly furnace.

Tata Steel will close down its two polluting blast furnaces at Port Talbot, which produces nearly 2 per cent of UK carbon emissions, and this is expected to render 2,800 jobs redundant.

The blast furnace can produce 5 million tonnes of steel, while the new electric arc furnace can produce up to 3.2 million tonnes of recycled steel a year.

The first blast furnace is due to close next month, while the second one will be shuttered in September. Tata Steel hopes to make an order for the new furnace equipment by September and start construction by August 2025.

Unions want Tatas to run at least one furnace to avoid making thousands of redundancies, while also building the electric arc furnace. However, Tata has rejected that plan, arguing that it was financially unsustainable.

The steelmaker is expected to open a voluntary redundancy scheme next week, but it is expected to face resistance from the unions.

Charlotte Brumpton-Childs, a national officer at GMB union, told the daily that the thousands of workers who are going to be impacted would like the management to put a bit more time into agreeing their redundancy terms.

Port Talbot steelworkers represented by the Community union last week voted overwhelmingly in favour of industrial action, as have Unite members. GMB has been forced to rerun its ballot to meet legal requirements.

Wales first minister Vaughan Gething had flown to Mumbai early this month to meet top Tata Steel officials and make a last-ditch effort to prevent job losses, but the management appears to have made up its mind.