In 2024, UK steel production made up 32% of domestic consumption and was responsible for 13.4% of GHGs from manufacturing, and 2.2% of total UK greenhouse gas emissions. The vast majority of this footprint is due to the coal burned at Scunthorpe steelworks. With the UK Government rightly ruling out any new coal mining projects in the UK, it is vital that UK steelworks becomes coal-free. Switching domestic coal mining for coal mining abroad would perpetuate colonial patterns of trade where the impacts of extractive industries are off-shored.

UK primary steel-making is wholly dependent on imports for the two main resources needed to make steel: ‘coked’ coal and iron ore. Coal needs to be ‘cooked’ in ‘coking ovens’ before it becomes coked coal capable of burning at very high temperatures required in blast furnaces. The UK closed its last coking oven in Port Talbot in March 2024. Since then, UK primary steel-making has depended on other countries to process coal in coking ovens before being imported into the UK.

The UK’s largest steelworks, Tata Steel UK’s Port Talbot steelworks, recently closed its blast furnaces, which had come to the end of their operational life. With £500 million from the UK Government, Tata seized the opportunity to shift from making coal-based blast furnace primary steel to using electricity to recycle scrap steel into new secondary steel products instead.This technology is called an ‘electric arc furnace’ (EAF). Although the transition should have had more Union and worker involvement, the conversion to EAF is a pragmatic move given the UK’s scrap steel surplus, the financial losses being made in the blast furnace steel production, and the UK’s net-zero commitments. Four of the UK’s other steelworks also recycle scrap steel using EAFs. The fifth is British Steel’s Scunthorpe steelworks, which still produces coal-based primary steel, and so is the second biggest single site source of CO2 in the UK.

Scunthorpe’s blast furnace steelworks needs to decarbonise to remain competitive, improve local air quality, and avoid fuelling climate chaos. Before the UK Government took partial control of the steelworks around April 2025, the operators – Jingye Group – claimed financial losses of £700,000 per day. Additionally, customers – who will soon face mandatory carbon reporting – may increasingly choose to import lower carbon steel from other European countries like Sweden and Spain who are pursuing low-emission primary steel production. The current options for Scunthorpe steelworks are:

1) convert to Direct-Reduction Iron technology to produce primary steel

2) convert to recycling scrap steel in a EAF to produce secondary steel products.

Producing secondary steel option would be much cheaper, but politically difficult as it would mean the loss of many jobs and the loss of the UK’s primary steel-making capacity. Find out more about the technology options below:

Read more about coal in steel in our 2021 report.

Blast furnace primary steel production: Metallurgical-grade coals converted to ‘coke’ which has a dual role in a blast-furnace, providing the required heat and creating a chemical reaction with iron ore reducing it to ‘pig’ iron which is heated with other additives (including small quantities of existing scrap steel) to make steel.

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Electric arc furnace secondary steel production uses 99% less coal than blast furnaces per tonne of steel produced by using electricity to melt down scrap steel to make secondary steel products, with small quantities of coal added to remove certain impurities. In countries, such as the UK, which generates a large share of its electricity through renewables, EAFs have a much smaller carbon footprint than blast furnace steel production. The UK currently produces a surplus of scrap steel, exporting it to EAFs abroad. Having greater EAF capacity in the UK will keep the scrap here, and the jobs it supports. Steel is – in theory – an endlessly recyclable product, but when it’s fused with other metals and materials, or has other properties added to it, it can be challenging to recycle it in EAFs into high-grade metals needed for certain applications, even with small quantities of coal added to remove certain impurities.

Feedstock reference

Direct reduced iron (DRI) primary steel production: is an emerging alternative to blast furnaces where natural gas or hydrogen replaces the role of coal in heating and reducing high-grade iron ore down to iron, ready for primary steel-making in an electric arc furnace. There are successful commercial test-cases for this technology, such as HyBrit in Sweden which uses hydro-generated green hydrogen to make steel. However, green hydrogen is prohibitively expensive, currently, so DRI facilities tend to use natural gas whilst being “hydrogen ready”. DRI production also makes capture rates for CCS much higher than a blast furnace.

It is vital that the forthcoming UK Government’s green public procurement policy for construction and Carbon Border Adjustment Mechanism should be sufficiently robust so as to support UK low-emission steel to compete with cheaper higher emission steel imports. Together, this should add confidence within the British steel sector that the UK Government’s public procurement pipeline will be a pipeline that supports domestic industry.

The UK Government must take action to secure the UK’s production of virtually coal-free secondary steel-making:

• The UK Government’s steel safeguard Tariff Rate Quota expires in June 2026 – but the UK’s Carbon Border Adjustment Mechanism is not expected to be implemented until 2027. The UK Government should introduce stop-gap measures to prevent high-carbon steel imports causing carbon-leaking and undermining investment to produce greener steel in the UK.

• The UK Government should engage in honest conversations now with unions and workers at the loss-making Scunthorpe Steel Works regarding the future of steel-making at the site. EAFs are currently the only financially viable technology to replace the coal-fed blast furnaces currently in operation. That would result in job losses but this can be a just transition with enough time to allow for proper planning, union and worker involvement, and funding. This should be followed with a commitment to add DRI primary steel production by mid-2035 as the technology and green hydrogen are expected to become more financially viable.