A delay in getting enough electricity to the Port Talbot site means there is currently a 12-month delay to the new electric arc furnace opening but bosses are confident that could come down
(Image: John Myers)
The opening of Tata’s new electric arc furnace at the Port Talbot steelworks could be delayed by up to 12 months, bosses have said, although they say they are hopeful that time can be reduced.
The electric arc furnace is a £1.25bn scheme to build one of the largest such furnaces in the world. The project, partly funded by the UK Government, is to replace the historic blast furnaces at the steelworks.
But issues have emerged with getting power to the site which could delay its start date by up to a year.
Tata Steel’s chief financial officer Koushik Chatterjee has said the delay was 18 months but has already reduced to 12 months. The Indian-owned company is hopeful it will reduce further.
He said “securing access to high-power electricity is critical for our planned transition”.
“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,” said Mr Chatterjee.
“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 about how long the delay might be Mr Chatterjee, Tata’s executive director and chief financial officer, said that was being discussed.
He replied: “Somewhat between, say, six months to eight months will certainly be there, maybe higher, after we have built the plant. The initial estimate was around 18 months. It has come down to 12 months and we’re actively working to see if we can reduce it further but there will be some delays imminent.”
He said the company was working with partners including the UK Government, the National Grid, and its electricity supplier to “see if we can mitigate”.
In a call three weeks ago CEO TV Narendran told journalists: “There is a delay of about 12 months in the electricity supply. What we are trying to see is at least some connection, one line, as soon as the plant is ready so we can do some trials, test out some equipment etc so we don’t waste the time that we’re waiting for the full electricity connection.
“Then what we are planning to do is to ramp up that we had scheduled after the commissioning how to compress that to make sure we catch up on the project.
“if we do the preparatory work before the full electricity connection is there we can do a quicker ramp up”.
In the call Mr Chatterjee said fixed costs in the UK in the last two years had fallen by 50%.
Before the delay in power access an operational estimate of late 2027 or early 2028 had been given. For our free daily briefing on the biggest issues facing the nation, sign up to the Wales Matters newsletter here.
The National Grid is building a new substation at its Margam site and delivering a second 275kV substation on Tata Steel’s Port Talbot site – which requires new supergrid transformers, as well as a 2km underground cable connecting the two substations to deliver the EAF.
It is understood issues emerged with ground conditions, and environmental and planning considerations, once work had started but that teams from National Grid have been on site since September.
Work on the new Margam substation will start in the coming weeks.
In recent days the Tata site has also been hit with a major fire.
Tata said its controversial decision to shut the historic steel plant’s two blast furnaces, signalling the end of steelmaking from raw materials in Wales, was due to a combination of cost-cutting and a move to decarbonising its operations.
On September 30, 2024, blast furnace four – the final one operating at the vast site – was closed ending 100 years of primary steel-making .
The site is being reworked around an electric arc furnace to recycle previously-used steel and when the decision was made Tata announced 2,800 job losses with the majority in Port Talbot. We now know that between September 2024 and the end of July 2025 2,162 people left the business.
Tata says it has lost £4bn in Port Talbot since 2007 and the new furnace would ensure a “financially and environmentally sustainable future” as well as reducing the site’s carbon emissions by 90%.
The UK Government gave £500m to the plans.
A Tata spokesman said: “The electric arc furnace programme is a major industrial project and, like all projects of this scale, timelines continue to evolve as detailed engineering, construction, and infrastructure work progresses.
“While we are still discussing potential adjustments to the commissioning timetable we are working closely with National Grid, our construction partners, and the UK Government to deliver the project safely and as quickly as possible.
“We have already met a series of key milestones in the construction phase and the shipment of major components including the EAF shells, tilting platform, and Consteel conveyor will commence imminently.”
A National Grid spokesperson said: “We recognise the importance of this project and remain committed to delivering the connection safely and at pace, working closely with our partners. Construction is underway and good progress is being made. This is a major, multimillion pound programme involving complex engineering, subject to environmental and planning considerations which require careful design and delivery.”
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