British Steel has applied for a £600 million support package

The company is seeking help from the incoming government to implement its decarbonisation plans

British Steel, a steel company owned by China’s Jingye Group, has applied for a £600 million state support package, The Guardian reports.

The company is looking for help from the future government to switch to less polluting technologies.

Government officials are to consider plans that outline the costs of switching from blast furnaces to electric arc furnaces at the company’s steel mills in Scunthorpe and Teesside.

The steel industry is one of the UK industries that could be most affected by a change of government in the general election. Labour leader Keir Starmer, who according to polls has a strong chance of becoming the next prime minister, is committed to investing £3 billion in decarbonizing the steel industry despite opposing other environmental spending plans.

After the election, the ministers will have the final say on support for British Steel. Any deal is likely to be scrutinized due to the fact that the company is owned by a Chinese group.

The new government will also have the final say on whether to implement the already agreed £500 million subsidy for Tata Steel UK.

Tata Steel is concerned about the future transformation of its Port Talbot plant amid the election. Nevertheless, the company says it will continue to close heavy assets and restructure the plant.

As GMK Center reported earlier, in April 2024, British Steel received a permit to build an electric arc furnace (EAF) at its Teesside plant, which is a key milestone in its decarbonization plan. An application for the construction of another EAF at the Scunthorpe plant was to be considered by North Lincolnshire Council.