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Clean Steel Fund

Volume 703: debated on Tuesday 16 November 2021

4. What steps his Department is taking to allocate funding from the Clean Steel Fund before 2023 following the development of hydrogen-based steelmaking projects in Sweden and Germany. (904239)

The Government continue to work with the UK steel sector, through the UK Steel Council, regular meetings and constant dialogue, to understand its decarbonisation plans, whether through electric arc, industrial carbon capture equipment or other emerging technologies such as hydrogen.

In contrast to Germany’s €3 billion hydrogen plan, there was no new funding announced in the recent Budget for clean steel projects. As 2023 is far too late, with primary steel plants accounting for 15% of UK CO2 emissions, will the Government now commit funding to clean steel projects similar to the ones we see in Germany and Sweden, or will steel communities be left standing by once again while European competitors get on with levelling up their industries?

I caution against the hon. Gentleman’s comparison. We have a similar ambition to countries such as Germany on things like hydrogen, and we have already published our hydrogen strategy. I have had extensive engagement with the steel sector in my two months as Minister for steel, including another visit yesterday, and we continue to want to support the industry on its decarbonisation journey. We know it is challenging, but there are already examples and we will continue to work with the industry to ensure it happens.

Years of Tory neglect and inaction mean the UK is falling further behind in the race to win the future of green steel production. Governments around the world are committing to their steel industries with long-term investment, but the Minister, the Budget and, indeed, the hydrogen strategy have failed to deliver any timetable for how the Clean Steel Fund will be implemented. There appears to be no urgency and no plan.

Will the Secretary of State tell us today whether he will back Labour’s plan for a £3 billion steel renewal fund to achieve near-zero-emissions steel production by 2035 to secure UK steel’s future? If not, why is he so content to see British industries lose out, more British businesses go under and more British jobs lost?

That is neither an accurate reflection of the situation nor an accurate reflection of the historical support that has been given to the steel industry. Since 2013, there has been £600 million-worth of support for electricity price relief. The industrial energy transformation fund was opened last year and steel companies had the opportunity to apply for it, and we have published the steel procurement pipeline and the steel safeguards. We will continue to work with this important sector to ensure that it can decarbonise and has long-term support for its future.