The steelmaker has announced its plans to close down the blast furnace in the Scunthorpe plant as part of a shift towards electric arc furnaces (EAFs).
Its ambitious decarbonisation plan could put thousands of jobs at risk.
The company – owned by China-based Jingye – has announced its intention of closing down the blast furnaces as part of a £1.25bn effort to shift to electric steelmaking operations, which would make British Steel “a clean, green and sustainable business”.
The firm’s green plan includes the building of two EAFs located in Scunthorpe and Teesside, as well as the shutting of its polluting coal-fired blast furnaces.
The EAFs are expected to reduce British Steel’s carbon dioxide emissions by 75 per cent. They could be in operation by late 2025, the company said.
Chief executive Xijun Cao said the move was necessary in order to meet the company’s environmental commitments.
“We have engaged extensively with the public and private sector to understand the feasibility of producing net zero steel with our current blast furnace operations. However, thorough analysis shows this is not viable,” he said.
“Detailed studies show electrification could rapidly accelerate our journey to net zero and drive British Steel towards a sustainable future. It would also ensure we can provide our customers with the steel they require.”
Nonetheless, union chiefs have described the move as “dangerous and foolhardy”, warning that the closure of the furnaces would leave the UK reliant on steel imports. They added the plans could lead to the loss of 1,500 to 2,000 jobs, predominantly at Scunthorpe.
“There is absolutely no need for mass redundancies at British Steel,” said Unite general secretary Sharon Graham. “We do not accept the need for one single job cut.
“Taxpayers should not be footing the bill for new investment unless that is linked to binding job guarantees. Only by the government taking a stake in the company will the right choices be made for the UK’s economy.”
Community Union general secretary Roy Rickhuss said he was “deeply concerned” by British Steel’s plans.
“[The plans] would leave the UK unable to make steel from raw materials and dangerously exposed to international markets,” he said. “Community firmly believes that the blast furnaces continue to be vital in any responsible transition to green steelmaking.”
British Steel said it is working with North Lincolnshire Council on “a masterplan” to attract new businesses and jobs to the Scunthorpe site. However, the company stressed the plans were still “subject to appropriate support” from the UK government – understood to be a grant worth £300m.
The Department for Business and Trade said the proposals were part of a plan to put the UK steel industry on a greener, more sustainable footing for the future.
Earlier this month, British Steel’s rival Tata delayed an announcement expected to reveal its plans to close its two blast furnaces in Port Talbot and cut 3,000 jobs.
British Steel employs 4,500 people in the UK.
