Industrials and manufacturers ask next UK Government for net-zero support

Pictured: Industrial cluster at Port Talbot

The Energy Intensive Users Group (EIUG) represents businesses in sectors such as steel, glass, chemicals and ceramics.

It has this week set out its general election manifesto, calling for the next Government to clarify the support its members will have on the path to net-zero by 2050 and to enhance the ‘British Industry Supercharger’ package.

Launched in April, the Supercharger is designed to help energy-intensive businesses weather the energy price crisis. The Government claims it could result in savings of up to £410m during 2025.

The Supercharger exempts businesses from contributing to certain costs linked to renewable energy policies, including the Contracts for Difference and the Renewables Obligation.

Participating firms also access a 60% reduction in network charges, a fee paid by businesses as a prerequisite for their electricity supply.

The EIUG would like to see this reduction increased to 90%. It argues that, at present, British firms are still paying higher electricity prices than in many other European nations. This is leading to multinationals choosing to invest in new sites and expansion elsewhere.

“Various Governments have taken measures to reduce higher prices, but a unlevel playing field still remains,” said EIUG chair Gareth Stace.

The EIUG is also urging policymakers, in rebalancing gas and electricity prices by potentially adding more levies or charges to gas, to exempt gas used by its members. Without such an exemption, it is warning, they could be undermined by imports from Asia and North America.

Net-Zero Investment Plan

The EIUG’s manifesto explains how the Group wants to be an enabler of, not a barrier to, the UK’s net-zero transition.

But it outlines how businesses are presently confused on their pathways to decarbonisation due to a lack of strategic decisions on technologies and gaps in investment plans for key low-carbon technologies.

The Group wants the next Government to set out a Net-Zero Investment Plan, identifying current and forthcoming gaps in the investment needed to decarbonise heavy industry and manufacturing.

Ministers have already set aside £500m through to 2028 to help businesses with high energy footprints to improve energy efficiency and implement low-carbon technologies such as electric or hydrogen heating systems. Additional funding pots have been provided to emerging technologies such as electric arc furnaces for steelmaking and carbon capture and storage (CCS).

The Group wants clarity on how the government will support its members beyond 2028 and how it intends to take less mature technologies past the demonstration phase and bring down costs.

Beyond providing finance from Westminster coffers, Ministers should clarify the future business model for industrial electrification, in the Group’s opinion. The model could be based on the ones already in place for hydrogen and in the pipeline for CCS.

Carbon clarity

Another section of the EIUG’s manifesto looks at carbon taxing.

The UK will launch its own Carbon Border Adjustment Mechanism (CBAM) in 2027, subjecting imported goods from nations with a lower carbon price than the UK to a climate levy.

The EU last year launched its own CBAM covering six sectors and is set to expand it to other industries in 2026.

Most British manufacturers are in support of a national CBAM, but have long been calling for reassurance that the UK and EU’s schemes will be aligned. The EIUG is reiterating that call to action.

The Group additionally wants Ministers to clarify policymaking timetables for reforming its Emissions Trading Scheme (ETS), which sets a limit on the emissions that energy-intensive industries can produce.

Allowances have been reduced to record lows in 2024, and will be cut further in the coming years, in a bid to encourage decarbonisation of industry in line with the UK’s legally binding climate targets. The ETS is also set to be expanded to include additional sectors, including energy-from-waste.

Comments (1)

  1. Richard Phillips says:

    Are not the greatest CO2 emitters the mobile transport sector?
    I se no great movement form HMG to alter this situation with support for electric vehicles, but then, it is rather an expensive move.
    Is there a way out?

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