UK Steel Crisis

[muddythefish]

Provided the supply chain is correctly monitored, there is actually nothing wrong with Chinese steel. Leave them to their own devices and they will send whatever suits them (can think of a few firms over here that would do the same mind!), but if you pay attention you will get what you want.

You do realise the Chinese are dumping steel or world markets that is being sold at less than cost - which is illegal ?

I'm not saying they should do nothing, but I certainly don't think we should be going down the route of the government sorting everything out.

The government could mothball the plant until steel demand and prices recover and the electricity prices come down.

The ex-employees of Redcar have a responsibility to themselves and their community to pick themselves up and get proactive in finding work.
It's a horrible set of circumstances they find themselves in, and not their fault. But that doesn't mean they should just sit there and feel sorry for themselves.

No doubt the younger ones will "pick themsleves up" but Teesside is an economically depressed area and it is not easy. It's also irrelevant to the central point that this country is in danger of losing a strategically vital industry.

If I'm being really harsh, they've had 5 years of hints that problems were ahead, and some might argue that employees should have seen this coming.

No doubt they did - and the remaining workers at Scunthorpe and elsewhere will be looking over their shoulders.

You can fight and posture all you want, but there are some fights that you just cannot win. Unfortunately this is one of the side effects of a global economy - if steel is cheaper elsewhere, customers will go elsewhere!

The usual wrong-headed right wing market forces argument.

 

[Domh245]

Perhaps Mods ought to merge this thread with the other 2 about steel-making and give it a generic title?

 

[backontrack]

You can fight and posture all you want, but there are some fights that you just cannot win. Unfortunately this is one of the side effects of a global economy - if steel is cheaper elsewhere, customers will go elsewhere!

But that's not the only thing - when many, many people lose their jobs, all simultaneously, then they lose their livelihood, their income. And the places they live in decline. People are hit so severely hit that it can take them, their community and the place where they live a very long time to get back on their feet. Take Millom, for example. The steelworks there closed in 1968 - nearly fifty years ago. Would you say it's recovered very quickly, if at all?

 

[mbonwick]

I really don't know how to reply to this, as some people are adamant on arguing black is white...

The country is short of electricity. We'll be down to 5% spare this winter - which is easily eaten up when everyone turns the heating and kettle on when they get in from work. Remember also that that 5% includes things like pumped storage that can only run flat out for a few hours.

The cost of generating electricity has not fallen either - while wholesale prices have fallen, the various taxes imposed have risen. Coal is cheaper than gas, but coal stations are being closed.

http://www.gridwatch.templar.co.uk/
As I type this, we're importing 3.15% of our electicity needs from France, and 2.42% from the Netherlands. Seeing as the 5% spare includes running the interconnectors flat out, you can see where a major problem lies if one experiences a fault...

I should probably just stop as I'm clearly not getting my point across.

 

[backontrack]

OK, I hate to shout things, but I've just been annoyed by how there's been next to no progress in the world recently (if Trump gets in to power in the US, then it'll obviously be even worse). But here goes:

RENEWABLES

 

[Robertj21a]

.
Is there really any point in everybody just going over the same old ground ?

There's a lot of workers in steel factories losing their jobs - FACT

Many are in already-deprived areas - FACT

Our energy costs are higher than other countries - FACT

There is little spare electricity capacity here at present - FACT

Some people will blame the Conservatives and some will blame Labour. It won't be a unanimous view - FACT

If we can get those issues out of the way it might clear the forest a bit to see where any new tree shoots could be identified to help these people.
.

 

[meridian2]

I agree totally backontrack, but when you have a government showing no loyalty to its homegrown skill-set opting for cheaper imports instead, you have no realistic hope of ever seeing 'cheaper' renewables that are just as efficient.

Why do you think all we see are wind farms? Cheap as chips rotating on a silly pole.

 

[radamfi]

As I type this, we're importing 3.15% of our electicity needs from France, and 2.42% from the Netherlands.

That's a lot less than I though. Transmitting electricity across national borders makes a lot of sense because the best sources of electricity are in places where few people live. For example Iceland has enormous potential for geothermal and hydroelectricity is plentiful in Norway. There are or will be cables between Norway and the heavily populated countries in north-west Europe. A similar cable between Iceland and northern Scotland would make a lot of sense. We shouldn't get obsessed with creating power inside each individual country.

 

[DarloRich]

I really don't know how to reply to this, as some people are adamant on arguing black is white...

The country is short of electricity. We'll be down to 5% spare this winter - which is easily eaten up when everyone turns the heating and kettle on when they get in from work. Remember also that that 5% includes things like pumped storage that can only run flat out for a few hours.

The cost of generating electricity has not fallen either - while wholesale prices have fallen, the various taxes imposed have risen. Coal is cheaper than gas, but coal stations are being closed.

http://www.gridwatch.templar.co.uk/
As I type this, we're importing 3.15% of our electicity needs from France, and 2.42% from the Netherlands. Seeing as the 5% spare includes running the interconnectors flat out, you can see where a major problem lies if one experiences a fault...

I should probably just stop as I'm clearly not getting my point across.

I understand your point entirely. We have the potential to run out of electricity. Sadly the wonderful privatised companies pocketed all the cash they earned rather than reinvesting it in the means of production and transmission and so we have to now pay again for it.

My point, which you haven't answered, is that my computer uses the same amount of electricity regardless of the price per unit. It wont suddenly consume more because the price falls.

It also doesn't answer my point that the smelting of ore still takes up the same level of electricity regardless of the price. How would lower energy prices for a steel works automatically mean they consume more power?
(other than through winning more orders by being more competitive)

.
Is there really any point in everybody just going over the same old ground ?

There's a lot of workers in steel factories losing their jobs - FACT

Many are in already-deprived areas - FACT

Our energy costs are higher than other countries - FACT

There is little spare electricity capacity here at present - FACT

Some people will blame the Conservatives and some will blame Labour. It won't be a unanimous view - FACT

If we can get those issues out of the way it might clear the forest a bit to see where any new tree shoots could be identified to help these people.
.

thank you oh mighty seer - perhaps you could tell us how to fix the problem?

 

[backontrack]

Why not invest in renewable energy?

-It won't run out in the foreseeable future
-It's much, much better for the planet
-There's industry involved in creating solar cells and panels, wind turbines and hydroelectric dams

 

[mbonwick]

My point, which you haven't answered, is that my computer uses the same amount of electricity regardless of the price per unit. It wont suddenly consume more because the price falls.

It also doesn't answer my point that the smelting of ore still takes up the same level of electricity regardless of the price. How would lower energy prices for a steel works automatically mean they consume more power?
(other than through winning more orders by being more competitive)

I haven't answered it because it's a completely obvious observation that leads nowhere, and because others have already answered it. I have never said that lower prices mean higher consumption for steel works.

Nothing consumes more power just because it's cheaper - but people have more options. For example, (if you were close to the poverty line) you might be able to run both your computer and heater for the evening, rather than having to choose one or the other.
Scale that up and you have a higher demand for power.

The privatised nature of the electricity industry has nothing to do with the failure to build new stations. All the companies are on long-term contracts to supply power/standby to the grid (which funnily enough the government gets to decide). We've had a long period of government where they failed to see the impending problem. No private company is going to waste billions on an asset that may never see use (and remember the political climate over the last few years has been that fossil fuel is bad - so without any firm agreements in place, its even more likely that you'll be turned down). So there has been no incentive for new stations to be built.

So even in a nationalised market, you'd still have the same problem because the government didn't know what it wanted - not because private enterprise wouldn't build it.
--- old post above --- --- new post below ---

Why not invest in renewable energy?

-It won't run out in the foreseeable future
-It's much, much better for the planet
-There's industry involved in creating solar cells and panels, wind turbines and hydroelectric dams

Because it is expensive, and (as yet) cannot provide enough energy to be viable.

Solar panels are around 4% efficient (the sort that generate electricity, not heat). For them to be viable they need to be at least 11% efficient, and there's at least 5 years of reasearch before we get near that point.

Wind power will only generate when its windy and cannot be relied upon to be continuous. There is no way for the grid to store electricty, so windy days cannot balance out calms.

The renewables industry should not be as large as it is, because it simply isn't helping solve the problem. The technology isn't ready for widespread deployment, but because of misguided government funding and subsidy over the last few years, they've spread rapidly.

 

[Tetchytyke]

Recently Germany set a new record of 78% of its daily electricity use coming from renewables. It wasn't sustained at that level, but it is showing that the technology is close. Renewable energy isn't just wind turbines.

I understand your point, I just do not agree that the price issue is to do with production. If you think the energy cartel will increase production to fund price cuts you are deluded. And the whole point of the privatised industry is "private sector efficiency and investment" will drive the market. Which it does; having output closely matching usage is exactly what "efficiency" is in a capital market. The whole point of the privatised industry is that they invest, and they're not doing.

But getting back to steel, the real issue is China are selling at a loss to put competitors in this country out of business. Still, Call Me Dave has invited the human rights abuser round for tea with the Queen, so that'll sort it(!)

 

[DarloRich]

I haven't answered it because it's a completely obvious observation that leads nowhere, and because others have already answered it. I have never said that lower prices mean higher consumption for steel works.

Nothing consumes more power just because it's cheaper - but people have more options. For example, (if you were close to the poverty line) you might be able to run both your computer and heater for the evening, rather than having to choose one or the other.
Scale that up and you have a higher demand for power.

The privatised nature of the electricity industry has nothing to do with the failure to build new stations. All the companies are on long-term contracts to supply power/standby to the grid (which funnily enough the government gets to decide). We've had a long period of government where they failed to see the impending problem. No private company is going to waste billions on an asset that may never see use (and remember the political climate over the last few years has been that fossil fuel is bad - so without any firm agreements in place, its even more likely that you'll be turned down). So there has been no incentive for new stations to be built.

So even in a nationalised market, you'd still have the same problem because the government didn't know what it wanted - not because private enterprise wouldn't build it.

lets agree to disagree. I feel we are being ripped off by companies who could and should reduce their prices but wont as they hold all control.

You feel we are being charged a fair amount and that such high bills are required because the lovely electricity companies have our best interests at heart and want to preserve supply while waiting for the government to bail them out and invest in new generating stations which excuses their shareholders the capital cost of building them.

BTW - I have been in the position of having to decide which items I turn on. That goes a long way to explaining my feelings about energy companies. Try a key meter for both gas and electric and let me know if your views stay the same..........

 

[radamfi]

Hydroelectricity is so cheap in Norway that they encourage the local population to use as much electricity as possible. Geothermal in Iceland is so plentiful that they heat the pavements in winter.

 

[Robertj21a]

thank you oh mighty seer - perhaps you could tell us how to fix the problem?

Sorry for trying to clarify matters for others. Don't worry, I won't bother again.

 

[DarloRich]

Sorry for trying to clarify matters for others. Don't worry, I won't bother again.

the issues are quite clear! How they are fixed and by whom is the issue

 

[RichmondCommu]

I'm surprised that given this is a railway forum that no one seems to be bothered by the knock on effect that this will have on rail freight. Given that one of the coke ovens is due to close this will have an immediate effect on the FOC's. As I understand it there is a regular flow of steel up to / from Dalzell and of course that has now gone too.

And just wait until the entire Scunthorpe production facility closes; by all accounts Tata wish to concentrate all of their resources at Port Talbot.

--- old post above --- --- new post below ---
Another point worth making here, cutting business rates would make one heck of a difference to anyone who exports given how high Sterling is at the moment. This something that the Government needs to look at but it needs to act quickly.

 

[backontrack]

Hydroelectricity is so cheap in Norway that they encourage the local population to use as much electricity as possible. Geothermal in Iceland is so plentiful that they heat the pavements in winter.

Indeed. There's also 10,000 times more solar energy hitting the earth then we need, hydroelectricity is already responsible for a fifth of the world's energy, and wind turbines for nearly an eighth of it (12%).

Plus, think of all the things we've used as biofuel. Dead flies, hydrogen (creating water as a by-product), methane, chocolate, sugar cane, paper, chopsticks, algae, and even, more famously, chip fat. Heck, we could even used broken-up Pacers as biofuel one day...

OK, so I'm exaggerating. But other countries in Europe are really leading in terms of energy and industry, Germany and Norway in particular. Let's not fall to the back of the queue again. These are all mostly British inventions. We're an innovative country, yet we don't use the ideas we get, we let them go abroad and pay massive amounts of money to import them back here again.

We should also have trains that use biofuel. By running stuff of our own waste, we're not taking more power away from our supply. Trains that use biofuel would be useful in the Bristol and Cardiff areas, running on services that make lots of stops frequently. Trains still use power when parked in stations - like TVs and over devices on standby - so it would be more eco-friendly to use biofuel on these.

You know what? We need commuter trains that can run on biomass. We could use them on the Overground lines, or in regularly-stopping services. These use energy when they're at stations - they're like TVs/computers on standby as they still use power - so why not use eco-friendly power?

 

[Domh245]

Indeed. There's also 10,000 times more solar energy hitting the earth then we need, hydroelectricity is already responsible for a fifth of the world's energy, and wind turbines for nearly an eighth of it (12%).

Plus, think of all the things we've used as biofuel. Dead flies, hydrogen (creating water as a by-product), methane, chocolate, sugar cane, paper, chopsticks, algae, and even, more famously, chip fat. Heck, we could even used broken-up Pacers as biofuel one day...

OK, so I'm exaggerating. But other countries in Europe are really leading in terms of energy and industry, Germany and Norway in particular. Let's not fall to the back of the queue again. These are all mostly British inventions. We're an innovative country, yet we don't use the ideas we get, we let them go abroad and pay massive amounts of money to import them back here again.

We should also have trains that use biofuel. By running stuff of our own waste, we're not taking more power away from our supply. Trains that use biofuel would be useful in the Bristol and Cardiff areas, running on services that make lots of stops frequently. Trains still use power when parked in stations - like TVs and over devices on standby - so it would be more eco-friendly to use biofuel on these.

You know what? We need commuter trains that can run on biomass. We could use them on the Overground lines, or in regularly-stopping services. These use energy when they're at stations - they're like TVs/computers on standby as they still use power - so why not use eco-friendly power?

It's great that we have got 10,000 times more energy than we need, but it is hard to capture said energy efficiently. Also don't forget that weather is pretty important when it comes to this, a PV cell farm in the midlands ain't going to do very well compared with an equally sized one in say, Dubai.

Again, Hydroelectricity may be responsible for 1/5th of the worlds electricity, but geography is very important. In a flat landlocked country, building dams isn't going to do anything. In a highly developed country as well, it can be very difficult to build hydroelectrics because you end up having to force people out of their homes, see the Three Gorges Dam in China as an example of this!

BTW, biofuel as you've described it is a very diverse thing! You mention hydrogen as a biofuel when it isn't anything of the type. Hydrogen fueled vehicles require completely different kit to operate compared with a conventional ICE. There are some biofuels that require conversion kits to allow you to run them, and then there are others where they simply replace conventional fuels like for like.

I don't know why you are suggesting using biofuel for stop start commuter services. Biofuel engines tend to have the same characteristics as conventional engines, so the only difference you are making is not using fuel which has come out of the ground. What we should be looking at for things like commuter services are:

a) Electrification
b) KERS type devices (flywheels)
c) Stop start engine technology

 

[radamfi]

Again, Hydroelectricity may be responsible for 1/5th of the worlds electricity, but geography is very important.

That's why it is important to have cables from where the main generating areas are to where most of the people are. Here in Europe we already have or soon will have access to hydroelectricity thanks to cables across the North Sea.

On this map, the small black dots show the land area required to replace the world primary energy supply with solar power:

https://en.wikipedia.org/wiki/Solar_power#/media/File:Solar_land_area.png

which indicates that solar panels in a small part of the Sahara Desert could power Europe on it own.

A lot of people insist on having power generation located within each political subdivision, but that does not take into account the energy producing potential of that particular area.

 

[Domh245]

Does that map account for transmission losses? A ~1000km cable to spain will loose energy hand over fist. As the bird flies, it would be ~1600miles to the UK, even longer when you route it through all of europe and then try to cram it down the 2GW link to France.

Also, I feel that southern Algeria isn't the safest place to be building huge solar farms:
https://www.gov.uk/foreign-travel-advice/algeria

 

[GrimsbyPacer]

There was alot of (mis?)-information sprouted out lastnight at Question Time here in Grimsby. I'm not sure who to believe. Here's some of the claims:

Could State Aid have been used to help the steel industry or not?
Would the UK being outside the EU prevent illegal Chinese steel dumping?
Is it true that half the £80million in extra help claimed by government is just redundency money?

 

[Tetchytyke]

Could State Aid have been used to help the steel industry or not?

It depends who you ask. I don't think they could just give a big sack of cash to one manufacturer, but there are ways of governments supporting businesses in other ways. The example of the Ineos loan guarantee shows it can be done.

Would the UK being outside the EU prevent illegal Chinese steel dumping?

The Government could choose to set any import tariff they wanted, and they could set one to offset the market distortion from the cheap Chinese steel.

That would, of course, have other trade consequences.

Is it true that half the £80million in extra help claimed by government is just redundency money?

Yes.

 

[Metrailway]

Would the UK being outside the EU prevent illegal Chinese steel dumping?

The Government could choose to set any import tariff they wanted, and they could set one to offset the market distortion from the cheap Chinese steel.

That would, of course, have other trade consequences.

Currently, the UK Government does not have the power to set any import tariff for goods entering the United Kingdom.

All EU member states are members of the EU Customs Union and therefore apply a common external tariff. If member states did have discretion to set tariffs, the Single Market would collapse.

This is why the UK (along with other EU member states) is unable to negotiate it's own free trade deals as member states are unable to set their own tariffs. The EU has to negotiate deals on their behalf.

 

[DarloRich]

It is worth ntiong that the Minster for the North(east)ern Poor House, James Wharton, has now fallen out with the editor of the Northern Echo over the papers alleged Labour bias and running constant critical stories of him. He is urging his constituents not to buy the paper: http://www.thenorthernecho.co.uk/features/13895571.The_Northern_Powercut/

This from the man who said over 2000 people loosing their jobs in a disadvantaged area, of whom many are his constituents, was a "distraction"

Northern Echo: But, having resisted the temptation for quite a while, it is time to go public with the position taken by Northern Powerhouse minister James Wharton, the Conservative MP for Stockton South, who refuses point blank to have anything to do with The Northern Echo. He refuses to take our calls or provide us with answers to our questions and has told me to inform my reporters not to call him. When I wrote to ask for an explanation on October 4, he replied in writing that it was due to “the Echo’s weekly attacks on me” and the paper’s “continual political bias”.

He really ought to grow a pair. For an ambitious politician he needs to develop better skills at dealing with critical influential local people and a thicker skin.

This all comes after Tory grandee Michael Heseltine said it was a "good time" for more than 2,000 steelworkers to lose their jobs. Clueless and out of touch with the realities of life. Same old Tories same old shi.......

http://www.thenorthernecho.co.uk/ne...e_than_2_000_steelworkers_to_lose_their_jobs/

Northern Echo: FORMER Deputy Prime Minister Michael Heseltine has been branded 'idiotic' and 'out of touch' after he said it was "probably as good a time" as any for steelworkers to lose their jobs.

 

[miami]

Nothing consumes more power just because it's cheaper - but people have more options. For example, (if you were close to the poverty line) you might be able to run both your computer and heater for the evening, rather than having to choose one or the other.

Assuming your heater is electric, then it doesn't matter. Run 3x 333W computers and you'll generate as much heat as you would with a 1KW 1-bar heater, and it will cost the same too.

I agree that scarcity of any commodity increases the price.

However electricity is not scarce. We have sufficient capacity for our needs, we don't have blackouts, we don't see factories losing their supply.

The simple fact of the matter is that the wholesale cost of generating electricity is dropping rapidly but the retail cost of buying electricity has remained static. That's price-gouging whichever way you slice it. The Government could take steps to deal with this- every other major European government has- but the Conservatives have point-blank refused to.

2014 the UK was pretty much in the middle off the road with electricity prices
https://upload.wikimedia.org/wikipedia/commons/a/a9/Electricity-prices-europe.jpg -- http://ec.europa.eu/eurostat/statis...,_second_half_2014_(¹)_(EUR_per_kWh)_YB15.png

May 1st 2015 price per kWh in cents

Denmark 33 May 1, 2015
Spain 25 May 1, 2015
United Kingdom 22 May 1, 2015

Earlier in the year

Sweden 8.33 Feb 3, 2015
Germany 32.04 Feb 1, 2015
Lithuania 14 Jan 1, 2015

I see no evidence saying that comparable EU countries are cheaper.
--- old post above --- --- new post below ---

The Government could choose to set any import tariff they wanted, and they could set one to offset the market distortion from the cheap Chinese steel.

This would only help with domestic steel usage. If the EU as a whole increased tarrifs that would have a larger effect.

Trouble is that it's not likely to happen, as those allowed to get into power are quite happy with the situation.