Port Talbot: an omen of environmental and economic policy disconnect

Britain’s transition to green manufacturing and industry is failing to protect livelihoods thanks to a lack of economic incentive, suggesting policymakers have not learnt lessons from the mining collapse.

Indian industrial giant Tata has announced the loss of 2,800 jobs from its UK operations. The steelmaker is switching from old blast furnaces to electric arc alternatives to cut CO2 emissions, a move that will see the workforce necessary to safely carry out operations reduced, leading to redundancies. 

The environmental benefits are notable. UK-wide emissions will fall by 1.5% just because of this single transition. But 2,500 of the people set to become unemployed work at the main Port Talbot steel plant, a town that’s home to just over 36,000 residents. That’s a devastating blow to an already-fragile local economy, and the situation is indicative of policy failings in Westminster, where lessons from the past have apparently been forgotten.

Net zero, as a concept, dictates the kind of economic upheaval arguably not seen since the beginning of the steam age. In comparison, the shuttering of industry in the north of England, Midlands and other regions in the latter half of the 20th Century was more limited in scope, but it’s here we find the most similar pst example. A nation switching economic focus through regulatory changes, but failing to introduce the systems, schemes and policies needed to move into a new age and retain jobs. 

A 2007 study by Christina Beatty, Stephen Fothergill, and Ryan Powell, Twenty Years On: has the economy of the UK coalfields recovered? shows that from a total of 220,000 jobs lost during the pit closures and miners strikes of the 1980s, a little under 90,000 had not been successfully replaced two decades later. More so, many of the worst impacted areas had become synonymous with endemic poverty, low tax contributions and high use of state benefits. Like South Wales, where Port Talbot is located. 

The Climate Change Committee reports 250,000 jobs have already been created through net zero, but up to 750,000 more could be needed to reach targets. While this should be good news for the British economy, Environment Journal has reported extensively on concerns that UK priorities like levelling up are not aligned with climate needs, and huge opportunities are being missed in terms of transitioning existing industries and infrastructure to low and zero emission operations. Simply put, centres of production are at risk of being left behind, despite offering some of the lowest hanging fruit because they are already established as bases for large scale manufacturing and other energy-heavy operations. 

In Port Talbot, news of job losses was made worse by subsequent reports Tata Steel Limited is expanding operations in its native India with a new blast furnace –  negating any emissions gains that will come from switching to electric arc furnaces in Wales. But we can’t confuse this highly questionable decision on the part of a private company with wider issues tied to net zero at home.

Even with the most progressive approach to driving green growth, the UK site may well have been scaled down. It certainly doesn’t look like the owner feels incentivised to refocus on green steel – jobs are not being relocated to countries offering big financial gains for setting up green industries. But this is besides the point.

Global industries and economies are on a one-way trajectory towards cleaner operations for reasons that go well-beyond the environment alone, but it is essential the foundations for what that looks like in the future are laid now. In many places, they’ve already been in place for several years. So it’s astounding to see such a lack of meaningful response from policymakers in the UK.

Downing Street will have known job losses at Port Talbot were almost inevitable for a long time – the efficiencies offered by electrical processes are significant. Only last November unions warned of between 1,500 and 2,000 redundancies at British Steel for the same reason, a transition to electric triggering lower demand for staff, borne from increasingly tighter climate-related legislation, of which governments have been central architects. Yet nothing has been done to encourage a green steel industry to develop in Britain, despite the rapidly emerging gap that must be filled.

More so, little is being done in any serious and committed way to court clean and net zero industries of all shapes and sizes. Meanwhile, economic competitors pledge vast financial support, subsidies, grants and more to these sectors so as to avoid being left without a chair when the music stops. Pouring ethanol into the smelting process, all this is happening as arguments wage about the decision to approve a new coal mine in Cumbria to fuel UK steel for years to come.

That investment is at odds with offering £500million to Tata so it can move away from highly polluting coal-fired steel production, resulting in job losses, many of which are yet to be replaced. And that is precisely the issue. When industry looks at countries such as Germany, with billions ringfenced for steel transition alone and coherency in terms of where money is allocated, it sees a viable place to do business. Analysing the UK reveals a confusing mess of disconnected policies, short-sighted funding strategies, and a misguided belief that indecision will not prove costly in the near future. This is as damaging to the nation’s net zero chances as its reputation for being an economy worthy of real investment. 

More on net zero transition: 

Is information overload blocking organisational sustainability?

Green Jobs Barometer reveals regional inequalities and fall in opportunities

Limiting local authority powers doubles down on Britain’s climate inaction

Image: Port Talbot via Wikipedia (top) / The Blowup (bottom)