UK steelmakers face far higher electricity prices than their European rivals this year, according to a new report from trade body UK Steel published on 20 October 2026. Here’s a quick look at the numbers and what they mean if your business buys steel parts.

What the UK Steel report found

The report, Competitive electricity prices: a prerequisite for reindustrialisation, is UK Steel’s eleventh annual assessment of electricity costs for British steel producers. After available exemptions and compensation, it estimates UK steelmakers will pay an average of £90.55/MWh in 2026/27, against £78.62/MWh in Germany and £60.64/MWh in France. That puts UK prices around 15% above Germany and 49% above France.

• The gap with France alone is estimated to add about £66 million to UK producers’ electricity bills in 2026/27.
• Since 2017/18, UK steelmakers are estimated to have paid £917 million more for electricity than French competitors.
• UK Steel says wholesale prices now explain most of the remaining gap, pointing to the role of gas in setting UK power prices and the rise in gas prices following the US-Israel-Iran conflict.

UK Steel is calling for a wholesale electricity price rebalancing mechanism for energy-intensive industries. Based on modelling by consultancy Baringa, it says this could cut steelmakers’ prices by around £24/MWh, to £66.55/MWh, at an estimated net cost of £51 million a year between 2026 and 2030, which it puts at roughly 42p per UK household per year. The Guardian reports the government says it is cutting electricity bills by up to 25% for over 10,000 manufacturing businesses.

What it means for UK manufacturers buying steel parts

Electricity is used at the mill, but its cost runs through the whole supply chain. If you buy laser-cut, folded or fabricated steel parts, a few practical points are worth keeping in mind:

• Watch material costs. Energy is a big cost for steelmakers, so it pays to keep an eye on how steel prices move over the coming months.
• Get firm prices quickly. When costs are under pressure, a firm quote you can act on today is worth more than a rough estimate next week.
• Plan ahead. Sharing forecasts and repeat schedules with your supplier helps them plan material and machine time around your needs.
• Value local UK supply. A UK-based supplier means shorter lead times, simpler delivery and one point of contact when a drawing changes.

Made in Shaw, Oldham

At Kaizen Engineering we laser cut, fold on our CNC press brake and fabricate made-to-order steel parts at our works in Shaw, Oldham. We offer same-day quotes and same-day laser cutting, so you can get a firm price fast and get parts moving without waiting around.

We work with large manufacturers who need repeat orders and contract supply, and with smaller firms who need a one-off, a short batch or an urgent replacement. See our full range of engineering services, or find out more about our laser cutting.

Send us your drawing

Email your drawing or DXF to sales@kaizen-eng.com with the material, thickness and quantity, and we’ll come back with a quote the same day.

Kaizen Engineering, Thomas Street, Shaw, Oldham OL2 8PG
Made Up North. Built to Last.

Sources

• UK Steel, “British steelmakers face widening electricity price gap – but solution could cost just 42p per household, UK Steel reveals” (accessed 20 Oct 2026): uksteel.org
• UK Steel, Competitive electricity prices: a prerequisite for reindustrialisation (report PDF, accessed 20 Oct 2026): UK Steel report (PDF)
• SteelOrbis, “UK steelmakers face 49% higher electricity prices than French competitors in 2026-27” (20 Oct 2026): steelorbis.com
• The Guardian, “Electricity costs put UK steelmakers in worst position in three years against EU rivals” (19 Oct 2026): theguardian.com
• The Manufacturer, Daily Manufacturing News Digest (20 Oct 2026): themanufacturer.com