Tata Steel’s proposal to construct a £1.25 billion electric arc furnace (EAF) at its Port Talbot steelworks has been approved by the official from the Port Talbot planning committee.
With construction set to commence this summer, the new facility is expected to be fully operational by early 2028. Designed to primarily process scrap steel, the EAF will replace the site’s two blast furnaces, which were decommissioned last year.
In its planning submission, Tata Steel highlighted the financial challenges faced at Port Talbot, reporting losses of £4 billion since 2007. The company emphasized that the transition to an electric arc furnace would establish a more “financially and environmentally sustainable” steelmaking operation.
Tata Steel has enlisted contractor Sir Robert McAlpine to lead the project, which will include demolishing existing structures and partially filling an on-site lagoon.
The furnace will work by melting mostly scrap steel, with other purer forms also being added to achieve specialist grades of the metal.
Asked about the potential impact of US tariffs on steel imports, Tata Steel UK boss Rajesh Nair said it was a “significant” question and that the company was still watching the space. “Ideally we would like to have a level playing field, where everyone plays the game in the right way,” he added.
The new electric furnace will have ultra-low emissions if the energy supply comes from renewable sources. Machinery manufacturer JCB had committed to buying “green” steel from the new furnace, according to Tata Steel.
The development will reduce carbon emissions by up to 90% compared to the previous blast furnace operation in Port Talbot. The Company had reported that they were facing a loss of £1m a day while keeping its blast furnaces running.
The closure of blast furnaces and the heavy steel production sector in Port Talbot has led to significant job losses, with around 2,500 positions already cut in South Wales and a further 300 redundancies expected in the near future. Many employees departed the company following the shutdown of the last blast furnace in September 2024. Despite these changes, steel mills in Port Talbot remain active, currently processing imported steel slabs.
As the site transitions toward a more sustainable model, the mills will eventually be supplied with steel produced by a new electric arc furnace, set to become operational by early 2028. Construction on the facility is scheduled to begin this summer.