The future of British manufacturing is under threat unless the government tackles the country’s sky-high industrial energy prices, industry group Make UK warned on Monday.
Despite government efforts to build a long-term industrial strategy, challenges from Brexit, energy price spikes, and global trade tensions continue to weigh on the sector. Prime Minister Keir Starmer’s administration has promised to boost manufacturing, but Make UK says urgent action is needed.
The group is calling for the removal of climate levies on industrial energy and the introduction of a fixed energy price for manufacturers.
In 2023, the UK recorded the highest industrial energy costs among all International Energy Agency members, largely due to its reliance on gas and the way electricity prices are set.
“If we don’t prioritise cutting industrial energy costs, we risk national security,” said Make UK CEO Stephen Phipson. “Without action, we’ll struggle to attract investment and face another wave of de-industrialisation.”
Over the past three decades, the UK has seen the steepest decline in manufacturing as a share of economic output among major European economies. In 2024, manufacturing accounted for just 9% of the economy, a record low, as the services sector continued to dominate.
Alan Johnson, a senior executive at Nissan, highlighted the issue, noting that the company’s Sunderland plant faces the highest energy costs of any Nissan facility worldwide.
He endorsed Make UK’s proposals, saying they would reassure investors that the UK is serious about building a competitive environment for electric vehicle production. Photo by Industry by the Grand Union Canal by N Chadwick, Wikimedia commons.