Government’s 2024 “Primary Steel” Pledge Faces Reversal in New Strategy

A core promise of the government’s 2024 industrial strategy is facing a potential reversal, as the new Business Secretary, Peter Kyle, backs a plan that contradicts his predecessor’s pledges. The move to electric arc furnaces (EAFs) at Scunthorpe “raise[s] questions” about the commitment to “primary steelmaking.”
When the government took emergency control of British Steel in April, ministers, including former Business Secretary Jonathan Reynolds, “repeatedly said” the goal was to preserve the UK’s ability to produce virgin steel from iron ore. This was the entire justification for the state intervention.
Now, Kyle, who is working on a new steel strategy for December, is championing EAFs. This “cleaner” technology, which melts scrap steel, is essential for meeting net-zero targets. However, it would render the blast furnaces—and the primary steelmaking process—obsolete.
This apparent policy U-turn has not gone unnoticed. The Community union, while welcoming a “just transition,” immediately countered that it is essential to “maintain primary steelmaking capacity.” This puts the union in direct opposition to the simplest version of the EAF plan.
To bridge this gap, a costly and “financially dubious” hydrogen-based (DRI) facility is being considered. But with the government’s £2.5bn steel fund already “drawn down” by “hundreds of millions,” it’s unclear if the government can afford to keep its original promise.