Aimed at starting operations by 2027, the project marks Tata Steel’s shift from blast furnace steelmaking to a lower-emission model, backed by UK government funding.
Tata Steel has closed its upstream operations in the UK and is currently supplying customers using imported substrate from India, the Netherlands and other sources.“>
Tata Steel will begin construction of its electric arc furnace (EAF)-based steel making facility at Port Talbot in July 2025, with operations expected to start by 2027. The development follows receipt of planning approvals and is part of the company’s transition from traditional blast furnace-based production to a lower-emission process, PTI reports. The company’s $1.5 billion project is backed by £500 million in funding from the UK Government. Tata Steel CEO and MD T V Narendran, and ED and CFO Koushik Chatterjee confirmed the timeline in the company’s FY2024-25 annual report.“We are now transitioning to decarbonised and state-of-the-art EAF-based steelmaking by FY2027-28, supported by 500 million pounds in the UK Government funding,” the company said.Shift in operations and cost structure
Tata Steel has closed its upstream operations in the UK and is currently supplying customers using imported substrate from India, the Netherlands and other sources.
“We have exited from steelmaking through the end-of-life heavy end assets in Port Talbot, and moved to a downstream model using imported substrate from India, the Netherlands and other external sources,” a company official said.
Tata Steel Chairman N Chandrasekaran said the company is progressing with its plan to shift to lower-emission steel production. “The decommissioning of two blast furnaces at Port Talbot has cleared the way for the next-generation Electric Arc Furnace (EAF) project, supported by the UK government,” he said.
The company is targeting a reduction in fixed costs from £762 million in FY25 to £540 million over the next year. These reductions will be achieved by optimising substrate costs, modernising IT systems, streamlining downstream operations, and cutting corporate overheads.
The EAF, once operational, will have a production capacity of 3.2 million tonnes of steel annually and is expected to reduce more than 50 million tonnes of carbon dioxide emissions over the next decade.
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