The UK government has increased financial aid for energy-intensive companies such as steelmakers, which have faced rising costs in recent months due to rising energy and gas prices.
The UK's Energy Security Strategy has confirmed that it will extend a compensation program for another three years that reimburses electricity-intensive industries the cost of the emissions trading scheme. According to the current formula, around 60% of the costs are covered, and officials said they will now try to increase it to 100%, according to the newly released document.
Steelworks in Britain are among the most energy-intensive industries struggling to cope with rising costs. Industrial estates across Europe have been disrupted as electricity and gas prices soared to unprecedented levels in recent months, driven by Russia's invasion of Ukraine. This has caused some plants to cut production. European Union countries are trying to agree on a fifth round of sanctions against Russia, including on energy imports, a move that could push prices higher.
The UK government also said it would exempt businesses from paying 100% of the Renewable Liability, an invoice tax that helps pay for new wind farms and other renewable energy projects to be built.
U.K. Richard Warren, head of policy and foreign affairs for Steel's trade body, said in an interview that the new measures were "significantly better than expected". However, the industry still awaits details on exactly how compensation will work in practice.
We expect the announcement to represent a major step forward for the UK steel industry and will provide much-needed relief in the face of extremely challenging conditions, UK Steel Director Gareth Stace said in a statement. said.
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