Tata Steel To Launch 3.2 Million-Tonne Low-Carbon UK Steel Plant By 2027

Tata Steel plans to build a new low-carbon steel plant using electric arc furnace (EAF) technology at its Port Talbot facility in the UK by July 2025, aiming to begin operations by 2027. Once ready, it will be able to make 3.2 million tonnes of low-emission steel every year. It is expected to play a major role in cutting carbon emissions.

"We have received all the necessary approvals for our $1.5 billion Electric Arc Furnace project at Port Talbot," said T.V. Narendran, CEO & MD, and Koushik Chatterjee, Executive Director & CFO of Tata Steel, in the company's FY2024-25 annual report.

Stock Movement

Tata Steel shares didn't react much to the progress and was trading flat. Tata Steel shares opened at 157.69 in the morning and, after hovering around the same levels, ended at 157.30 on Monday. June 9. The stock has reached its 52-week high on 18th June 2024 at Rs 184.60.

Overall performance

The company has earlier mentioned the progressive work of the low-carbon EAF-based plant in its 12th May report, which highlighted the company's Q4 FY25 performance.
However, Tata Steel's Q4 FY25 results were in line with the estimates, with the company reporting Rs 1,300.81 crore consolidated net profit for the quarter ended March 31, 2025, more than doubling from Rs 611.48 crore in the same quarter last year (Q4FY24).

The company's consolidated revenue from operations stood at Rs 56,218.11 crore in Q4FY25, down 4.2 per cent year-on-year from Rs 58,687.31 crore, but up 4.8 per cent from Rs 53,648.30 crore in the previous quarter (Q3FY25).

UK Government's Support

The UK Government is supporting the project with £500 million in funding. The move is part of Tata Steel's shift from traditional, high-emission blast furnaces to cleaner EAF technology, which uses recycled scrap metal to produce steel. The new facility will be capable of producing 3.2 million tonnes of low-emission steel each year.

Job Loss And Support Plan for Port Talbot Workers

Tata Steel has shut down both of its old blast furnaces at the Port Talbot plant in the UK, reducing fixed costs by over Rs 2,600 crore (a 23% cut). This move is part of the company's shift to a cleaner steel production method using electric arc furnace (EAF) technology.

As part of this transition, around 2,800 jobs will be cut due to the closure of the blast furnace operations. However, the new EAF-based setup is expected to keep about 5,000 jobs across Tata Steel UK and its supply chain.

To help affected workers, Tata Steel and the UK government have set up a £100 million Transition Board. This fund will offer support such as job retraining, help with relocation, and community programs.

For now, Tata Steel has paused its local steelmaking in the UK and is supplying customers with steel made using materials imported from its plants in India, the Netherlands, and other countries.

Focus on Cost-cutting & Sustainability

The company is also focusing on cutting costs as it transforms its business. Tata Steel plans to reduce fixed costs from £762 million this year to £540 million next year. This will be achieved by modernising IT systems, streamlining operations, and cutting overheads.

Over the next 10 years, the EAF project is expected to prevent more than 50 million tonnes of carbon dioxide emissions, marking a major step in Tata Steel's commitment to sustainability and green manufacturing.