Around 5,000 jobs have been secured following the start of construction on Tata Steel’s electric arc furnace at Port Talbot steelworks today.
Tata Group chairman Natarajan Chandrasekaran will be joined by business secretary Jonathan Reynolds and Wales secretary Jo Stevens to break ground on the project and start construction later today.
The project has been made possible by a £500 million UK government grant, which Labour agreed 10 weeks after coming into power.
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Industry minister Sarah Jones is chairing a meeting of the Steel Council in Cardiff this morning to work towards finalising the upcoming Steel Strategy, backed by up to £2.5bn of investment.
The strategy includes the reduced energy costs for steel producers announced last month, safeguarding measures to protect the steel industry from spikes of foreign steel imports, and changes to procurement rules to ensure UK-made steel is prioritised for use on public construction projects.
The government is also backing the steel sector by working closely with the US to secure the removal of 25% tariffs on steel and aluminium, while the UK remains the only country in the world not to pay a 50% tariff.
Business secretary Jonathan Reynolds said it is great news for Welsh steelmaking, giving certainty to local communities and thousands of local jobs for years to come.
“This government is committed to a bright future for our steel industry, which is why we provided £500 million of funding to make this project possible,” he said. “Our modern Industrial Strategy has set out how we’ll back the sector even further, including by slashing energy costs for firms like Tata Steel to level the playing field, as part of our Plan for Change.”
The electric arc furnace is expected to reduce the Port Talbot site’s carbon emissions by around 90%.
Chandrasekaran said: “This is a proud day for Tata Group, Tata Steel and for the UK. Today’s groundbreaking marks not just the beginning of a new electric arc furnace, but a new era for sustainable manufacturing in Britain. At Port Talbot, we are building the foundations of a cleaner, greener future, supporting jobs, driving innovation, and demonstrating our commitment to responsible industry leadership.”
Stevens said: “The construction of Tata’s new furnace realises the promise we made to the community, while the development of floating offshore wind, plans for a Celtic Freeport and millions more for local regeneration all mean that Port Talbot has a bright future.”
Alasdair McDiarmid, assistant general secretary of the Community union, said: “This bittersweet day is a consequence of the devastating closure of the blast furnaces, but importantly, a future for Port Talbot steelmaking is being secured. The workforce needs the electric arc furnace project to be both a success and a turning point, and we look forward to playing our part to get the new furnace up and running.”
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