British Steel’s Scunthorpe plant are planning to close down the blast furnaces which could see the loss of up to 2,000 jobs.
The company is owned by Chinese firm Jingye who are planning to replace the blast furnaces with electric arc versions which are zero-carbon electricity.
The BBC reported that they will build one new electric arc furnace at the Scunthorpe plant and unions have warned this move will lead to the loss of 1,500 to 2,000 jobs.
British Steel are also closing on the government funded support package which is worth around £500 million that will help the change to electric arc furnaces.
British Steel CEO Xijun Cao said: “Decarbonisation is a major challenge for our business but we are committed to manufacturing the home-made, low-embedded carbon steel the UK needs.
“We have engaged extensively with the public and private sector to understand the feasibility of producing net zero steel with our current blast furnace operations. However, thorough analysis shows this is not viable.
“Detailed studies show electrification could rapidly accelerate our journey to net zero and drive British Steel towards a sustainable future.”
Community Union general secretary Roy Rickhuss responded: “We are deeply concerned by British Steel’s plans for an EAF-only approach at Scunthorpe and Teesside, and it is vital a meaningful consultation takes place to assess all the options to secure the future of steelmaking.
“Were they to be realised the plans that British Steel has announced, combined with Tata Steel’s plans, would leave the UK unable to make steel from raw materials and dangerously exposed to international markets.
“Community firmly believes that the blast furnaces continue to be vital in any responsible transition to green steelmaking.”