From the Guardian · · 1m 40s
UK steelmakers face worst electricity cost gap in three years
British Steel and rivals pay almost £30 per megawatt hour more than French competitors, driven by gas price surge after Iran closes the Strait of Hormuz.
In brief
British Steel and rivals pay almost £30 per megawatt hour more than French competitors, driven by gas price surge after Iran closes the Strait of Hormuz. UK steelmakers face their worst electricity cost disadvantage against European rivals in three years, with the premium over France rising to almost thirty pounds per…
UK steelmakers hit by electricity cost surge
British steelmakers now pay almost thirty pounds per megawatt hour more than French rivals, the highest premium in three years, according to analysis by UK Steel.
Iran's strait closure drives global gas prices up
The US-Israeli war on Iran caused the country to close the Strait of Hormuz in response to Donald Trump's bombing campaign, sending global gas prices soaring.
UK's gas reliance makes electricity expensive
The UK relies on gas for power generation, which determines wholesale electricity prices even for cheaper sources like wind and solar. France uses nuclear reactors instead.
Steel exports to EU at stake
About seventy five percent of exported British steel, worth about three billion pounds, goes to the EU, making European cost comparisons particularly important for UK steelmakers.
UK Steel calls for direct subsidies
Peter Brennan, director general of UK Steel, said steelmakers are being asked to compete with one hand tied behind their backs and direct subsidies are the only option.
“British steelmakers are being asked to compete with one hand tied behind their backs.”
UK Steel proposes fifty one million pound price cap
The lobby group has proposed a price cap costing about fifty one million pounds a year, with government paying the difference when prices exceed the cap level.
The takeaway
UK steelmakers face their worst electricity cost disadvantage against European rivals in three years, with the premium over France rising to almost thirty pounds per megawatt hour.
