A new analysis from UK Steel highlights a disparity in electricity costs for UK steelmakers compared to their counterparts in France and Spain.
Over the past three months, wholesale electricity prices in the UK averaged nearly £66 per megawatt hour (MWh), while in France and Spain, prices were around £27/MWh and £28/MWh respectively.
The data underscores a hurdle for the UK’s steel industry, which is heavily reliant on electricity and anticipates a doubling of consumption with the adoption of new Electric Arc Furnace (EAF) technology.
This technology shift is crucial for the sector’s decarbonisation efforts but demands competitive electricity prices to succeed.
Despite recent measures like the British Industrial Supercharger, which aimed to reduce policy costs and network charges, UK steelmakers still face substantially higher electricity costs compared to their European competitors, UK Steel said.
This disparity not only impacts competitiveness but also undermines efforts to attract investments and achieve decarbonisation goals.
UK Steel’s Energy and Climate Change Policy Manager, Frank Aaskov, said: “The UK steel industry cannot continue to face electricity prices that are more than double what our main European competitors benefit from.
“UK Steel data shows that wholesale electricity prices in the UK have been double the French and Spanish wholesale prices in recent months.
“For the UK steel industry to prosper and deliver on its decarbonisation targets, a new Government must deliver the lowest electricity prices in Europe.”
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