UK banks on low-carbon
28 Feb 2010
In the wake of the recent decision to mothball most of the Corus Teesside Cast Products plant at Redcar on Teesside, with the likely loss of 1,600 steel jobs, union leaders wishfully called on government to offer manufacturing industry the same support as offered to the banking sector.
But comments, such as that from GMB senior officer John Wilson that “Like the banks, steel is the bedrock of our economy”, are likely to fall on deaf ears at Westminister, where the idea of a low-carbon economy means new, ’green’ industries such as wind farms and biofuels are in vogue, while investment in traditional industries such as steel and petrochemicals is seen to offer poor returns.
The decision by Corus parent group Tata, for example, is linked to the cancellation of the main supply contract - a 10-year agreement to buy over 70% of the plant’s production, which was unilaterally cancelled after four years. The move is a body blow for a region that has specialised in iron and steelmaking for 150 years, and which has also seen high profile closures by chemicals majors Dow Chemical, Croda and Petroplus.
Government’s response is a two-part package to create an estimated 3,000 new jobs in the short-to-medium term and sustain over 10,000 jobs long term. Phase 1 of the programme will address immediate issues arising from the Corus mothballing. This includes providing around £10 million for apprenticeships and support for new businesses, plus up to £20 million investment in the nearby Wilton International site.
Another £30 million will be used to equip Teesside to move from traditional heavy industry towards becoming a “low-carbon manufacturing base”. This includes investment in the redevelopment of industrial land and infrastructure and to establish bio-based materials, to reduce energy use of industry in the area, for initiatives on carbon capture and storage, and support for technology transfer and new business practices.
“We must act to secure long term employment in sustainable manufacturing in the region,” said Lord Mandelson. “[This] investment will strengthen existing industries and create new opportunities.”
Typical of the new promise are plans by Future Capital Partners - a £6 billion investment boutique - to raise £40 million in investment funds to build a biorefinery in the North East. The facility would have capacity to produce 200 million litres of bioethanol and 175 kilotonnes of high protein animal feeds per annum.
Construction partner for the project is Simon Carves Ltd, which has recently completed the Ensus biorefinery at Wilton on Teesside that will provide both food and fuel.
