British Steel announces 'green steel' to be made on Teesside

British Steel has announced it is investing in an electric arc furnace at its Lackenby plant. Credit: Tees Valley Combined Authority

Steelmaking is set to return to Teesside following an announcement that it will be the location for one of British Steel's electric arc furnaces.

About 250 people will make so-called "green steel" - named because the process is cleaner than a traditional blast furnace - at the company's plant in Lackenby, Redcar.

British Steel has announced a £1.25 billion proposal to adopt electric arc furnace steelmaking in Teesside and Scunthorpe, where up to 2,000 people could lose their jobs due to the change.

Steelmaking disappeared on Teesside in 2015, when SSI collapsed, ending generations of traditional steel manufacturing.

The former blast furnace in Redcar, which had dominated the skyline on Teesside for more than 40 years, was demolished in November 2022.

British Steel said its new furnaces could be operational by late 2025.

Xijun Cao, chief executive and president of the company, said: “Decarbonisation is a major challenge for our business but we are committed to manufacturing the home-made, low-embedded carbon steel the UK needs.

“We have engaged extensively with the public and private sector to understand the feasibility of producing net zero steel with our current blast furnace operations. However, thorough analysis shows this is not viable.

“Detailed studies show electrification could rapidly accelerate our journey to net zero and drive British Steel towards a sustainable future. It would also ensure we can provide our customers with the steel they require."

Redcar's bast furnace was demolished in November 2022, seven years after SSI's steel making plant closed on Teesside. Credit: PA

Welcoming the news, Tees Valley Mayor Ben Houchen, who pledged to bring steelmaking back to the area ahead of his re-election in 2021, said: "Steel is in our blood and to be able to say that steelmaking is coming back, it's going to create more jobs and protect the almost 1,000 jobs with British Steel on Teesside. It's an incredible journey and it just shows it's not the end of the story for Teesside steelmaking."

Anna Turley, who is standing as the Labour candidate for Redcar at the next general election and was MP in 2015, was part of the campaign against the SSI closure.

Responding to British Steel's announcement, she said: "We welcome every job that comes to that site. It's brilliant to have steel still living and breathing on Teesside. It's part of the fabric and DNA and part of the lives of generations of Teessiders. It's wonderful we're keeping steel going.

"And it's also wonderful to see the future of steel. This is green steel, this is modern steel. We've always said it's an industry of the future and not a sunset industry. It's great to see steel as part of that transition to Net Zero and it's great that is happening on Teesside."

Councillor Alec Brown, leader of Redcar and Cleveland Borough Council, said: “Generations of families in Redcar and Cleveland has prospered through employment in the steelmaking industry. The closure of the Redcar blast furnace was a huge blow to both our borough and the wider region, but British Steel has continued to invest in its operations and workforce at both Lackenby and Skinningrove."

Want a quick and expert briefing on the biggest news stories? Listen to our latest podcasts to find out What You Need To Know...