Construction has officially begun today (14 July) on Tata Steel’s new electric arc furnace (EAF) at Port Talbot, securing 5,000 jobs and marking a major milestone in the UK’s transition to
greener steel production.
Business Secretary Jonathan Reynolds, Welsh Secretary Jo Stevens, and Tata Group Chairman N. Chandrasekaran came together at the Port Talbot site to break ground on the project. The new EAF is expected to cut carbon emissions at the steelworks by around 90%.
The project has been made possible through a £500 million UK Government grant — part of a broader support package agreed just 10 weeks after the new Government took office. This investment is a significant boost for the Welsh steel industry ahead of the Government’s forthcoming UK Steel Strategy.
Earlier today in Cardiff, Industry Minister Sarah Jones chaired a meeting of the Steel Council at 7Steel, bringing together industry leaders from across the sector, including British Steel and UK Steel. The council discussed finalising the new Steel Strategy, which is backed by up to £2.5 billion of investment, and recent progress for the industry.
Key initiatives include:
Cutting energy costs for UK steel producers through measures announced in the UK’s Industrial Strategy.
Strengthening safeguards against surges in foreign steel imports.
Reforming public procurement rules to prioritise British-made steel on infrastructure projects.
The Government is also actively working with the United States to secure the removal of 25% tariffs on UK steel and aluminium exports — with the UK currently remaining the only country globally exempt from a 50% tariff.
Business Secretary Jonathan Reynolds said:
“This is our Industrial Strategy in action and is great news for Welsh steelmaking backing this crucial Welsh industry, which will give certainty to local communities and thousands of local jobs for years to come.
This government is committed to a bright future for our steel industry, which is why we provided £500 million of funding to make this project possible. Our modern Industrial Strategy has set out how we’ll back the sector even further, including by slashing energy costs for firms like Tata Steel to level the playing field, as part of our Plan for Change”.
This latest development follows a landmark UK-India trade deal agreed in May, strengthening the UK’s economic ties with India and encouraging further investment from Tata Group and other Indian companies into British industry.
During today’s groundbreaking event, the Business Secretary toured the future EAF site, met Tata Steel’s senior management, and took part in a virtual reality demonstration previewing the new furnace in operation.
Tata Group Chairman Mr Chandrasekaran said:
“This is a proud day for Tata Group, Tata Steel and for the UK. Today’s groundbreaking marks not just the beginning of a new Electric Arc Furnace, but a new era for sustainable manufacturing in Britain. At Port Talbot, we are building the foundations of a cleaner, greener future, supporting jobs, driving innovation, and demonstrating our commitment to responsible industry leadership.
This project is also part of Tata Group’s wider investment in the UK, across steel, automotive, and technology among others, which reflects our deep and enduring partnership with this country”.
Secretary of State for Wales Jo Stevens said:
“The UK Government acted decisively to ensure that steelmaking in Port Talbot will continue for generations to come, backing Tata Steel with £500 million to secure its future in the town, along with £80 million to support workers and the wider community. Our Steel Strategy will also deliver up to £2.5 billion of investment to rebuild the UK industry, maintain jobs and drive growth.
The construction of Tata’ s new furnace realises the promise we made to the community, while the development of floating offshore wind, plans for a Celtic Freeport and millions more for local regeneration all mean that Port Talbot has a bright future”.