Payments of around $372 million to each company are being debated in parliament. The proposal is backed by British Treasury secretary Jeremy Hunt.
The money identified is planned to be sent to finance activities to decarbonize production. The funds allocated should help companies replace blast furnaces with electric arcs, thereby reducing carbon emissions.
The country's largest steel mill, owned by Tata Steel Uk, in Port Talbot, Wales, accounts for 2% of the UK's carbon emissions and Wales' 15%.
British Steel is owned by China Jingye Group. It bought the bankrupt company in 2020, but in October 2022, the new British Steel management called on the British government to budget the business and thousands of jobs. The company now produces about 3 million tons of steel per year.
Tata Steel UK has informed UK authorities in need of financial assistance for the transition to 'green' metallurgy in 2022. On average, the company produces 3.6 million tons of steel per year, but the funds allocated may not be enough. Tata Steel's businesses will need about 3 billion or 10 times more to decarbonize, according to company analysts' estimates.
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