The government’s decision to retake control of British Steel’s Scunthorpe plant from its Chinese owners Jingye leaves ministers facing big questions. How, for example, was a critically vital and strategic industry like steel production allowed to fall into hands of a Chinese company with no interest in what it meant for the UK?
Ed Miliband, the energy secretary, has much to answer for. His net zero obsession — ostensibly aimed at ending reliance on expensive fossil fuels by going green faster — has left British Steel production on the brink of extinction. Emergency stocks of coking coal are now being rushed from Japan to the Scunthorpe plant to help keep the furnaces burning.
Why is Britain shipping coking coal from Japan when it could just as easily be produced here? How is it better for the environment to ship coal halfway around the world rather than produce it in our own backyard? After all, our European neighbours, including Germany, Holland and Sweden, make their own steel. Why shouldn’t the UK?
For the simple reason that ministers chose a different path to burnish their environmental credentials. This has involved pursuing green energy policies that artificially drive up the price of making steel in this country, rendering it economically unsustainable.
This included a plan to switch to electric furnaces instead of those powered by coking coal, using electricity generated through green sources. The problem is that the electric furnaces need huge subsidies and will take several years to build. Meanwhile other countries such as China, which has kept its coal mines open, are able to produce cheap power from coal and carry on making steel which Britain then buys. All of this because of a political obsession with reaching net zero by 2050.
Miliband has in the past boasted about the previous Labour government’s decision to phase out coal power. This was completed last September and Miliband claimed other countries would follow “our example”. Really? It seems highly unlikely.
All of this green posturing by ministers has meant turning a blind eye to the obvious long-term consequences for jobs. Something that voters will not quickly forget. The enormous real-world consequences of the Westminster political establishment’s consensus on net zero have become all too clear during this crisis and Miliband is the high priest of this ruinous fantasy.
