Climate-change policies put UK at a disadvantage

UK manufacturing sectors are at a major competitive disadvantage due to climate-change policies, a new Government report shows. The research, commissioned by BIS, suggests that steel makers in competing countries such as Germany, Russia, India, USA and China can expect to pay considerably less for their electricity. Indeed, the EEF (the manufacturers’ association) says that — in the worst-case scenario — UK steel makers could find themselves paying over 280% more in 2020.

It is a similar situation for manufacturers in the cement, industrial-gases and chlor-alkali sectors, all of whom provide the building blocks for thousands of products. The EEF says that the absence of a global deal on climate change is creating a ‘beggar thy neighbour’ approach, with different countries pursuing carbon reduction policies at different rates and costs, even within the EU.

EEF chief executive Terry Scuoler says: “This report provides clear, independent evidence supporting concerns we have long put to government — that UK manufacturers in energy-intensive sectors are paying more for their electricity than many of their global and European competitors. “Both the Treasury and DECC believe we must not outpace our competitors in loading costs onto hard-pressed businesses. However, this report shows that there is a mismatch between intent and reality.

The proposed package of measures announced by the Chancellor in the Autumn Statement are welcome but only last until 2015. Similar measures must be put in place for 2015-2020 to give manufacturers certainty and a level playing field with their competitors.”Climate-change policies put UK at a disadvantage