British Steel Industry Calls for Help with Electricity Prices

Onshore wind turbines at Little Cheyne Court Wind Farm operate beside electricity pylons in Dungeness, Britain, July 10, 2024. REUTERS/Chris J. Ratcliffe/File photo
Onshore wind turbines at Little Cheyne Court Wind Farm operate beside electricity pylons in Dungeness, Britain, July 10, 2024. REUTERS/Chris J. Ratcliffe/File photo
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British Steel Industry Calls for Help with Electricity Prices

Onshore wind turbines at Little Cheyne Court Wind Farm operate beside electricity pylons in Dungeness, Britain, July 10, 2024. REUTERS/Chris J. Ratcliffe/File photo
Onshore wind turbines at Little Cheyne Court Wind Farm operate beside electricity pylons in Dungeness, Britain, July 10, 2024. REUTERS/Chris J. Ratcliffe/File photo

Britain's steel industry has called on the government to help with electricity prices that it says can be it 50% higher than those paid by European competitors.

Earlier this week, the sector was hit by a 25% tariff on exports to the US that make up around 9% of the value of Britain's steel exports.

"Uncompetitive electricity prices must be addressed to ensure the steel industry can thrive, secure thousands of jobs, and safeguard national steel production as geopolitical turbulence increases," said Frank Aaskov, Director, Energy and Climate Change Policy at industry group UK Steel.

The group, which represents the country's main steel producers, has called on the government to set fixed electricity prices for the sector via a contract-for-difference, Reuters reported.

Under the system, if wholesale electricity prices rise above a threshold called the strike price, the government would subsidise the difference, and if it fell below a certain level, the steel makers would pay back the difference.

"The strike price could be set at regular intervals to reflect changes in wholesale electricity prices and provide the steel sector with much-needed protection from price volatility,” a report by consultancy Baringa, commissioned by the steel industry said.

The Baringa report said UK producers pay around 68 pounds per megawatt hour (MWh) for electricity, compared with 52 pounds/MWh in Germany and 44 pounds MWh in France.

Last month, the government launched a consultation on a strategy for the steel sector, said it sought to invest 2.5 billion pounds ($3.23 billion) and look at issues including high energy costs.

A government spokesperson said the government was "already bringing energy costs for steel closer in line with other major economies" through a package of measures to support industry.

"This fully exempts eligible firms from certain costs linked to renewable energy policies, particularly those exposed to the high cost of electricity, such as steel."

Steel UK members include British Steel, Liberty Steel and Tata Steel.



Moroccan Utility ONEE Granted $340 Million in Loans for Energy Transition

File photo of a police officer standing near a Moroccan national flag near the main stadium during preparations for the FIFA Club World Cup in Agadir, December 10, 2013. REUTERS/Amr Abdallah Dalsh
File photo of a police officer standing near a Moroccan national flag near the main stadium during preparations for the FIFA Club World Cup in Agadir, December 10, 2013. REUTERS/Amr Abdallah Dalsh
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Moroccan Utility ONEE Granted $340 Million in Loans for Energy Transition

File photo of a police officer standing near a Moroccan national flag near the main stadium during preparations for the FIFA Club World Cup in Agadir, December 10, 2013. REUTERS/Amr Abdallah Dalsh
File photo of a police officer standing near a Moroccan national flag near the main stadium during preparations for the FIFA Club World Cup in Agadir, December 10, 2013. REUTERS/Amr Abdallah Dalsh

Moroccan water and power utility ONEE said it has been granted 300 million euros ($340 million) in loans from the European Investment Bank (EIB) and German state lender KfW to support integration of renewable energy into the national grid.

The financing package comprises 170 million euros from the EIB and 130 million euros from KfW, the utility said on Friday, adding that the money will be used to expand its electricity transmission network by 730km.

ONEE plans to invest $19 billion in its electricity development plan through 2030, the year Morocco will co-host the World Cup soccer tournament, together with Spain and Portugal.

The plan aims to increase installed renewable energy capacity to 56% of the country's total electricity capacity by 2027, three years ahead of the 2030 target, according to Reuters.

Currently, installed renewable energy capacity stands at 45%, or 5.5GW.

ONEE said it will add 15GW of installed electricity capacity, including 12GW from renewable sources by 2030.

Last week ONEE signed a deal with the United Arab Emirates' TAQA to build a 1,400 km high-voltage transmission line with a capacity of 3,000 megawatts linking Western Sahara’s renewable energy sites to central Morocco.

Coal still accounts for more than 70% of Morocco's energy production.

Seeking to diversify its coal-dependent energy sector, Morocco began in April a tendering process to build a liquefied natural gas terminal in the Mediterranean port of Nador.