The report claims the owner of the Port Talbot Steelworks has warned that the sites could be closed without subsidies to reduce carbon emissions.
The Financial Times says the Tata Group is looking to strike a deal to provide the UK government with £1.5bn. The UK’s largest steelworks in Port Talbot employs 4,000 people.
The UK government stated that steel “plays an important role” in the UK economy and that Tata was “a significant steel producer and important employer”.
Speaking to the FT, Tata Group chairman Natarajan Chandrasekaran said: “A transition to a greener steel plant is the intention that we have . . . But this is only possible with financial help from the government.
“We have been in discussions over the last two years, and we should agree within 12 months. Without this, we will have to look at closures of sites.”
The report said Tata is looking to close two blast furnaces at Port Talbot and build two electric arc furnaces, which will be less carbon-intensive. However, the FT said the process would cost around £3bn, with Tata seeking £1.5bn from the UK government.
Tata employs 8,000 people across the UK, with half of these in Port Talbot and thousands more indirectly through the supply chain.
Like all industrial groups that emit carbon dioxide, it has been asked to cut these, and executives have discussed it with the UK government.
Charlotte Childs from the GMB union told the FT: “This is deeply worrying news.
“UK steel is a critical part of the nation’s industrial infrastructure and central to our national security . . . It’s essential the government act quickly and show they are serious about this vital industry.”