Government announces £49.4m to help heavy industry switch to lower carbon fuels

It will support the steel, ceramics, pharmaceutical and food production industries in ending their reliance on fossil fuels and reducing energy costs

Big Zero Report 2023

The government has announced £49.4 million of investment to support the development of fuel switching technology for Britain’s heavy industry.

The funding will be awarded to “pioneering” projects as part of the government’s plans to support the British industry – including steel, ceramics, pharmaceuticals and food production – in ending their reliance on fossil fuels and reducing energy costs as the nation transitions to a low carbon economy.

Industrial fuel switching shifts industrial energy use from high carbon to low carbon fuels, with the aim of decarbonising industry in line with the UK’s target of reaching net zero by 2050.

Fossil fuels, including coal, gas and oil, made up around 55% of industrial energy consumption in 2019.

Industrial emissions need to fall by around two-thirds by 2035 and at least 90% by 2050 as set out in the Industrial Decarbonisation Strategy to decarbonise industry in line with net zero.

The latest funding is available through the second phase of the £55 million Industrial Fuel Switching competition.

Business and Energy Minister Lord Callanan said: “We’re investing nearly £50 million to back British industry, making sure they’re fit for the future and helping end their dependency on expensive fossil fuels.

“Developing fuel switching technology will make this possible, accelerating the transition to cleaner fuels across our economy and driving down costs for businesses.”

Previous winners under the first phase included projects helping the ceramics, food production and steel sectors powered by hydrogen instead of natural gas, technology to develop heat pumps for food and pharmaceutical businesses and studies exploring switching glass-making facilities from natural gas to gasified waste and biomass.

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