The Government is to pump up to £500 million into Britain’s biggest steelworks as part of plans to produce “greener” steel which could also hit thousands of jobs, sources have said.
Tata, the Indian conglomerate that owns the Port Talbot steelworks in South Wales, will use the funding to help switch the plant’s two coal-fired blast furnaces to electric arc versions that can run on zero-carbon electricity.
However, the company will also caution on Friday that the plans will lead to consultations over a “deep potential restructuring”.
The £1.25 billion furnaces are expected to be up and running within three years of getting regulatory and planning approvals, Tata Steel is expected to announce.
Tata warned last year that its UK operations were under threat unless it secured Government funding to help it move to less carbon-intensive electric arc furnaces.
Unions have previously said that the move to the new less labour-intensive furnaces could lead to around 3,000 job losses.