Plans for a £1.25bn electric arc furnace in Port Talbot are facing a delay of up to eight months after National Grid warned that its electrical connectivity project is behind schedule, Tata Steel has revealed.
The new furnace was expected to replace traditional blast furnaces that closed two years ago with the loss of 2,000 jobs, and was hoped to be operational by the end of 2027. But during a conference call with investors last month, Tata Steel’s executive director and chief financial officer, Koushik Chatterjee, disclosed the setback.
“Tata Steel warns £1.25bn Port Talbot electric furnace may be delayed up to eight months due to National Grid electrical connectivity issues.”
“Securing access to high power electricity is critical for our planned transition,” Chatterjee said. “While we are working with the electricity system operator and the National Grid for new electrical infrastructure, National Grid has formally alerted us that their connectivity project is delayed. This is critical for Tata Steel UK for the project commissioning. We are in conversation with National Grid and the UK government on resolution of the issues.”
Asked how long the delay might be, Chatterjee added: “Somewhat between, say, six months to eight months will certainly be there, maybe higher, after we have built the plant.” He said the company was working with partners including the UK government, National Grid and its electricity supplier to “see if we can mitigate”.
Tata Steel has already completed major demolition work on the Port Talbot site, including the controlled demolition of an empty gas holder earlier in June. In a statement, the company acknowledged that “timelines continue to evolve as detailed engineering, construction and infrastructure work progresses” and said it was “discussing potential adjustments to the commissioning timetable” with its partners “to deliver the project safely and as quickly as possible”.
National Grid said the work involved constructing two new substations, installing transformers and laying 2km of underground cables. It cited issues with ground conditions as well as environmental and planning considerations as contributing to the delays, although it insisted “good progress is being made”.
The delay raises uncertainty over the future of steelmaking in Port Talbot, where the closure of traditional blast furnaces had already dealt a severe blow to the local economy. Tata Steel’s transition to electric arc technology is seen as crucial for the site’s long-term viability, but the electrical grid problem now threatens to push back the commissioning of the new furnace well into 2028.