Tata Steel: What happens next for the Port Talbot plant?

This week the UK Government committed to investing £500 million into Tata Steel's Port Talbot plan, in a bid to make steel making greener.

Jonathan Reynolds told the House of Commons the deal "does what previous deals failed to do" and gives "hope for the future of steelmaking in South Wales".

The wheels of change had already been set in motion by the Indian company earlier this year but with the confirmation from the new government to go ahead with the subsidy, the bulk of the work will begin to transform the works.

Tata estimates a new electric arc furnace will be operational on the site by 2028. It says this new steel-making method will be far less carbon-intensive and save the company billions of pounds.

The next few months are expected to be the most painful for many working in Port Talbot and those in the supply chain.

The First Minister described an "incredibly unsettling situation for many".

Tata's CEO said: "We now look forward to the efficient and speedy execution of the EAF project."

'Restructuring' plans announced

Tata Steel employees say they are used to the prospect of job losses - the Port Talbot plant has seen redundancies and cuts throughout its long history.

This latest round of cuts was confirmed in January when Tata Steel said it would begin a restructuring process with the support of a £500 million UK Government subsidy.

Tata said it would invest another £750 million, and the process would begin to decommission Port Talbot's two blast furnaces, Blast Furnaces 4 and 5, and replace them with a single electric arc furnace.

A large proportion of the 2,800 expected job losses will come from all the staff working on and around the two blast furnaces, in the plant's "heavy end".

Closures of 'heavy-end' start

This started in March when 200 jobs were impacted as the steelworks' coke ovens were closed.

Built to produce the carbon-rich fuel for the furnaces, the coke ovens closed earlier than expected because of safety concerns.

They are no longer needed in the new electric arc production.

Four months later, the first of the two blast furnaces closed. Blast Furnace 5 produced its last load of steel on 4 July.

A month later, in September the plant's harbour received its last shipment of raw materials.

Section Engineering Manager, Mark Powys said: “It was clearly a sad and emotional day for everyone involved – it really is the end of an era in Port Talbot."

When Blast Furnace 4 closes at the end of September, it will signal the end of virgin steel-making at the plant and the end of the wider heavy-end operations.

With this will come the majority of job losses. An estimated 2,500 jobs will go when the final blast furnace, and the wider operations around it, close.

The UK Government have agreed to the £500 million subsidy on the condition that those workers are given a minimum redundancy payment of £15,000, plus a retention payment of £5,000.

The Government says its "new and improved" plan will also make sure staff who are made redundant will receive a comprehensive training programme.

What comes next for Port Talbot's steelworks?

This will then give way to the next stage of Tata's plans, as work will start to install the new electric arc furnace on the site.

The company says "basic engineering is now complete" and the equipment and infrastructure for the new electric arc furnace "will be placed shortly".

By November, it is expected that planning permission will be submitted for the work to install the equipment, and Tata hopes that work will start in July 2025.

The Indian steel giant says it hopes to get the arc furnace up and running within three years of work starting.

Electric arc furnaces produce steel differently from how it is currently produced. The furnace is filled with cold recycled steel. Then electrodes are lowered into the furnaces and melted.

Tata Steel says when the electric arc furnace is up and running, it "will reduce the UK’s entire industrial carbon emissions by 8%".

Once it is up and running, Port Talbot's electric arc furnace will produce steel in a way never seen before in the town's more than 120 years of steelmaking.

Instead of creating steel from scratch in a blast furnace, the new electric arc furnace will melt down scrap metal using heat created by powerful electricity.

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