The UK Government is providing £500 million, and Tata Steel is expected to provide another £725 million. Most of this money will go to converting the sprawling steelworks from its current Basic Oxygen Furnaces to Electric Arc Furnaces. The former produces virgin steel from iron ore, heavily relying on coal for the chemical reaction. Electric Arc Furnaces recycles scrap steel without needing coal. Currently, the UK exports a considerable quantity of scrap steel abroad (over 8 million tonnes in 2021), and scrap steel is expected to greatly increase in abundance globally.

Port Talbot steelworks is currently the 2^nd highest source of CO2 from any single site in the UK. Transitioning this steelworks is expected to make a significant impact on the UK’s emissions. Steelworks around the world contribute 11% to global greenhouse gas emissions… rapid decarbonisation globally is essential to limit climate chaos and, alongside electric arc furnaces, alternatives are under development and testing that removes coal from the process of making virgin steel.

However, steelworks employ many thousands of people around the world, whose labour has been essential for everything from vehicles and renewable energy infrastructure to household appliances. It’s essential steel workers and their unions are centred in the changes needed to decarbonise steelworks to ensure a just transition that doesn’t leave these workers behind. The planned decarbonisation of Port Talbot Steelworks has been reported not to follow the principles of a just transition. Instead, the company has reportedly shut unions out of its negotiations with the UK Government and there aren’t any reported programmes of retraining or support packages to equip workers facing redundancy with realistic prospects of finding alternative work that suits their experience or ambitions.

Steel companies in Europe may be amongst the first to decarbonise their steelworks, so it is essential they set a good example for steel companies elsewhere to follow. European steelworks, therefore, must meaningfully engage with their workers and workers’ Unions from the outset of plans to decarbonise steelworks, focusing on those most impacted by potential changes. We are sceptical of top-down consultations on changes which often have foregone conclusions—engagement must be in the form of equal partners around the table. For workers, this can have the advantage of securing packages of support that are appropriate for their needs, whether that is to stay within the company or gain employment in another industry. Worker creativity may also reduce their own job losses and impacts—if they are able to meaningfully shape the transition process. Companies benefit from the creative capacity of workers who have on-the-ground expertise, greater trust in the changes ahead, reputational impacts, better worker morale and loyalty, and the wider fallout that structural unemployment can drive.