London, 27th October 2021 – The Energy Intensive Users Group (EIUG) is deeply disappointed that Government has yet to take any action to contain escalating energy costs that are putting vital energy intensive industries, which make products essential for the UK economy, under additional pressure as winter approaches.
Three weeks ago, EIUG set out proposals to help manage the impact of sustained high energy costs for energy intensive industries (EIIs). The EIUG package included a winter cost containment measure, reducing network costs for EIIs and modifying gas emergency procedures. A Government – industry bilateral meeting was held yesterday to further progress solutions but no clear solutions emerged. Today’s Comprehensive Spending Review, compounded the pressure on industry by offering no new ideas to help support the industry this winter and there is no firm commitment to address the underlying structural issues within the UK energy system.
Dr Richard Leese, the EIUG Chair, commented:
“UK Government and the energy regulator have reported that energy prices are already significantly higher than those faced by our European competitors. The current sustained high energy prices will result in further disparity between UK and competitor operational costs. The lack of urgency from the UK Government in addressing the unprecedented spike in industrial energy prices is adding further cost and risk to UK energy intensive industries, continuing to undermine the inward investment needed for the net zero transition“.
EIUG Contact: Director – Energy Intensive Users? Group (director@eiug.org.uk)
Notes to editors:
The EIUG represents the UK’s Energy Intensive Industries (EIIs) including manufacturers of steel, chemicals, fertilisers, paper, glass, cement, lime, ceramics and industrial gases. EIUG members produce materials which are essential inputs to UK manufacturing supply chains, including materials that support climate solutions in the energy, transport, construction, agriculture and household sectors. They add an annual contribution of 38bn to UK GDP, supporting 200,000 jobs directly and 800,000 jobs indirectly around the country.
These foundation industries are both energy and trade intensive remaining located & continuing to invest in the UK and competing globally requires secure, internationally competitive energy supplies and freedom to export without tariff barriers. However, inward investment, growth and competitiveness have been hampered for years by UK energy costs higher than those of international competitors. In some cases, investment, economic activity & jobs have relocated abroad, leading to a subsequent increase in imports.