The Welsh Government says tackling the high energy costs faced by steelmakers is essential to the future of an industry that is vital to the Welsh economy.
To ensure steelmaking in Wales has a future and investment is sustained, the steel industry must be able to compete on a level playing field internationally. High UK energy costs and uncertainty over the impacts of UK Government energy and climate change policy are having a significant impact on competitiveness and business investment decisions. We have raised this at the highest levels of UK Government.
– Welsh Government evidence to Westminster inquiry
The UK Government must therefore deliver on its commitment to compensate key electricity-intensive businesses to help offset the indirect costs of energy and climate change policies ... to compete internationally ... Concerns were expressed as to whether the level of support will adequately compensate those industries most affected, and whether there is a UK Government commitment to support those industries longer term ... Immediate measures [are needed] to relieve the impact of current energy prices on high volume energy intensive manufacturers including steel producers.
Tata steel directly employs over 7,000 people in Wales, with over 10,000 more workers in jobs that depend on Tata's Welsh operations. A new £240 million blast furnace at Port Talbot is almost ready and the hot strip mill at Llanwern, which stopped production in 2010, is being re-opened.
But the firm announced 769 job losses in Wales last November, together with the creation of 223 new jobs, as the result of a restructuring that will close some of its smaller sites. The biggest losses were of 500 management and support jobs at Port Talbot, with other gains and losses across Wales.
- Closure of steel finishing at Cross Keys and Tafarnaubach: 163 job losses
- Closure of Caldicot and other small service centres: 106 job losses
- New steel finishing operation at Shotton: 38 new jobs
- New major service centre at Llanwern: 65 new jobs
- Restart of hot strip mill at Llanwern: 120 new jobs