New Steel Crisis Threatened By Delays To Green Energy Rebate Law
European red tape threatens to push Britain’s hard-pressed steel sector back into crisis with the prospect of the energy-intensive industry’s power bills soaring.
Officials at the European Commission have yet to agree a state aid change that will exempt the industry from punitive green taxes. UK steelmakers struggle to compete with foreign rivals, who enjoy much cheaper power bills.
Steelmakers have successfully campaigned for an 85pc rebate on their energy costs. In March’s Budget, the Government agreed a deal where the industry paid the green levies, but then got the money back in a rebate from the Treasury.
The Government has budgeted for the £5m-a-month rebate for steel makers until the end of March 2017. By then, it hopes to have secured European approval for a change in state aid rules, which would allow the cost to be pushed on to consumers.
This would mean that, rather than pay the cost of the levy and have it refunded, the green taxes would not be paid at all.
However, the steel industry is worried that European officials have not yet rubber-stamped the change, with a January 9 deadline for UK lawmakers to get legislation.