Tata Steel plans to begin the construction of its low-carbon electric arc furnace (EAF) steelmaking facility in Port Talbot, UK, by July 2025, with operations set to commence by 2027, according to senior company officials. The company has secured the necessary approvals for the $1.5 billion project. In the annual report for FY 2024-25, Tata Steel CEO & MD T.V. Narendran and ED & CFO Koushik Chatterjee confirmed that 500 million pounds in funding from the UK Government will support this transition towards decarbonised EAF steelmaking.
The EAF project at Port Talbot has received the required planning approvals, and construction is scheduled to begin in July 2025. Tata Steel has already shifted its operations and is currently serving customers through its facilities in India and the Netherlands.
“We have exited steelmaking from the aging heavy-end assets at Port Talbot and are now operating a downstream model, sourcing substrate from India, Netherlands, and other external suppliers,” said a company representative.
The shift to electric arc furnaces is part of Tata Steel’s broader strategy to reduce carbon emissions. The company aims to phase out the blast furnace process and move towards a more sustainable steelmaking model that will use locally available scrap metal.
Additionally, the company is focused on cost rationalisation. Tata Steel intends to reduce its fixed costs from 762 million pounds in FY2024-25 to 540 million pounds in the next fiscal year. This reduction will be achieved by optimising substrate costs, modernising IT systems, and streamlining downstream operations, while eliminating unnecessary corporate overheads.
Tata Steel UK has already made significant progress in its green steel transformation. In December 2023, the company signed a deal with JCB for the supply of green steel, reinforcing its commitment to sustainable partnerships. In October 2024, Tata Steel appointed world-leading metals technology manufacturer Tenova to supply the new furnace, and Sir Robert McAlpine was recently named as the project’s main works contractor. These strategic moves position Tata Steel as a key player in the global shift towards low-carbon steel production.
As one of the world’s most ethically recognized and geographically diversified steel producers, Tata Steel Group operates with an annual crude steel capacity of 34 million tonnes. The company recorded a consolidated turnover of $27.7 billion in the 2023-24 financial year and continues to drive innovation in sustainable steelmaking. With the Port Talbot green steel project now moving forward, Tata Steel UK is set to play a pivotal role in the UK’s industrial transformation, ensuring a more sustainable, competitive, and resilient steel sector for the future.
