Measures aim to boost UK competitiveness by compensating for high electricity network costs
PRODUCERS of cement and lime have welcomed plans announced yesterday (11 October) by the Government to boost UK competitiveness through compensating for high network charges as part of the ‘British Industry Supercharger’.
The Mineral Products Association (MPA), which represents UK cement and lime manufacturers, says the network charges compensation announced by the Department for Business and Trade will ease electricity costs and narrow the disparity between the UK and EU industrial electricity prices.
It adds that combined with other elements of the Supercharger proposals, this will go some way towards supporting the industry’s ability to compete with overseas manufacturers.
The British Industry Supercharger comprises three measures, aimed at creating a more competitive and sustainable industrial sector:
Increasing the existing Energy-Intensive Industries Renewable Levy Exemption scheme from 85% to 100%
Introducing a 100% exemption from the costs of the Capacity Market
Compensating 60% of the charges incurred by the industry’s use of the electricity grid via a Network Charging Compensation Scheme.
The total package will save eligible businesses an expected £24 to £31 per MWh.
Dr Diana Casey, the MPA’s executive director for energy and climate change, said: ‘After lengthy discussions exploring the challenges faced by cement and lime producers, and the knock-on impact for the UK economy as a whole, we are pleased that the Department for Business and Trade has acted quickly to achieve a major step forward for the industry.
‘The cost of electricity is considered a contributing factor to increasing imports of cement into the UK, which have slowly crept up by about one percentage point per year until 2021 and 2022 when they shot up by four percentage points per year.
‘Fair electricity prices will be absolutely critical for cement and lime producers to continue to decarbonize in line with our roadmaps, especially the transition to carbon capture, usage and storage, which will significantly increase power demand. If electricity prices are not competitive, they could be a barrier to producers delivering on our net-zero commitments.
‘Even with the new Supercharger measures, in the UK we still pay more than competitors in the EU for electricity and that disparity puts cement and lime producers at a disadvantage. Although today’s action is a real breakthrough, we look forward to continuing the dialogue with the Government to ensure cement and lime producers can remain competitive.’