Tata Steel to Launch Green Steel Project in July 2025

Tata Steel is set to begin construction in July 2025 on a landmark low-emission electric arc furnace (EAF) steelmaking project at its Port Talbot plant in Wales. The facility, backed by full planning permissions and £500 million in UK government funding, marks a strategic pivot from traditional blast-furnace operations toward clean and sustainable steel production.

Valued at USD 1.5 billion (approx. ₹125 billion), this development targets commercial output by 2027 and is expected to be fully operational by FY 2027–28 under the stewardship of Tata Steel’s executive leadership. The project foresees producing 3.2 million tonnes per annum of low-carbon steel, using at least 90 percent recycled scrap—an initiative aligned with Tata Steel’s commitment to net-zero emissions by 2045 . This shift follows the decommissioning of blast furnaces at the Port Talbot site, prompting Tata Steel to maintain supply to its UK clients via imported steel substrates from its India and Netherlands facilities until the EAF plant comes online .This interim measure ensures continuity during the transition phase.

The EAF facility, equipped with Tenova’s advanced furnace technology and electric stirring systems, will not only lower on-site CO₂ emissions by up to 90 percent, but cut over 50 million tonnes of carbon dioxide over the next decade. This aligns with UK policy, including the National Wealth Fund’s commitment to £2.5 billion for industrial decarbonisation. Tata’s calcined cost-base will also see a strategic overhaul. Annual fixed costs (£762 million in FY 2025) are slated for reduction to £540 million through rationalisation of capital inputs, digital systems, streamlined downstream operations, and lean corporate structures .

However, this transition, while environmentally commendable, entails a socio-economic impact. The blast furnace shutdown in January 2024 led to the loss of around 2,800 jobs in Port Talbot—prompting strong union protests. The government and Tata Steel have committed to retraining support and redundancy terms, but many view the move as a hard trade-off between green ambitions and local livelihoods. Analysts caution that while electric arc furnaces offer sustainability, they rely on regional scrap availability. The UK’s limited scrap steel production could constrain long-term operations. Critics argue that without supplementary technology—such as hydrogen-based direct reduced iron—the country risks dependency on secondary raw materials.

On a governance level, Tata, alongside the government, is pursuing extensive environmental compliance. Community consultations concluded in late 2024, with construction anticipated to commence in July 2025. A joint oversight body will monitor emissions, resource usage, and job impacts throughout construction and commissioning . Green steel advocates see this project as a model for India-made steel entering global low-carbon supply chains. Tata Steel’s investment boosts the UK’s green industrial capacity and demonstrates its broader strategy to lead decarbonisation efforts—critical for climate leadership in hard-to-abate industries.

Yet, UK competitors remain cautious. While Wales is scaling back blast furnace output, nations like Germany and Sweden continue investing in hydrogen-based steelmaking. In contrast, the UK’s approach—predominantly EAF—may not fully future-proof costs or industrial sovereignty . Still, with Port Talbot projected to reduce emissions by nearly 90 percent on-site—accounting for 1.5 percent of the UK’s direct CO₂ emissions—it marks a significant leg in national decarbonisation ambitions. From a city-focused outlook, Port Talbot represents more than a recycling mill—it’s a hub where technical innovation, climate responsibility, and social resilience converge. As UK authorities aim for green industry and low-carbon jobs, Tata’s initiative will be closely observed by regional planners, climate councils, and investors.

The fundamental challenge now is one of balance: delivering world-class green steel infrastructure without sidelining communities. Tata and the UK Government have pledged local hiring, apprenticeships, and skill-transfer programmes—but the shift from blast furnace to EAF may not restore all lost roles. Globally, Tata’s green project feeds into India’s decarbonisation narrative. As Tata Steel India decarbonises its Odisha and Jamshedpur sites, its UK initiative is a test-bed for future green growth, circularity, and supply chain neutrality. Lessons from Port Talbot will inform low-carbon strategy in emerging megacities where steel demand and urban ambition meet environmental urgency.

Whether built-in July 2025 or delayed by site constraints, the Port Talbot EAF plant stands to become a milestone of industrial transformation—not just for Wales, but for cities and industries navigating the carbon transition.

Tata Steel to Launch Green Steel Project in July 2025