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Nov 23, 2023

Factories receive government support to grow the economy, cut emissions and reduce energy costs

Energy intensive business across the UK receive government support to become

Energy intensive business across the UK receive government support to become more energy efficient.

Factories producing some of the country's best-known beers, cereals, soft drinks and cars will receive government support to reduce their energy costs and cut carbon emissions.

Heineken, Kellogg's, Toyota and Britvic are among businesses across the UK to be awarded a share of £24.3 million government funding to help clean up their manufacturing processes and improve their energy efficiency.

The Industrial Energy Transformation Fund (IETF) supports businesses using high amounts of energy to reduce their fossil fuel using innovative low-carbon technologies. This will help companies save on their energy costs, which in turn will safeguard British jobs and help grow the economy – one of the government's 5 priorities.

Other recipients include Ingevity UK in Warrington, which will receive £2.6 million for hydrogen ready natural gas fuelled boilers at their chemicals plant, Natural World Products in Dunmurry, a producer of peat-free composts and soil conditioners, is receiving nearly £300,000 to replace diesel-powered plant equipment with electric kit, and Breedon Cement is receiving over £231,000 for a feasibility study on using carbon capture technologies at their site in Hope, Derbyshire.

Energy-intensive industries are responsible for 11% of the UK's total emissions and represent over 70% of UK industrial emissions. While the UK is making excellent progress on the road to net zero, having cut emissions by 48% between 1990 and 2021 - decarbonising faster than any other G7 country - it is estimated that industry will need to cut their emissions by two thirds by 2035 for the UK to achieve its net zero target.

Minister for Energy Efficiency Lord Callanan said:

We are leading the world in reaching net zero, having cut emissions by 48% – but to keep up this progress and achieve our green goals, we’ve got to transform our industrial sectors, as some of the industries most critical to our economy are also those with the highest emissions.

Today, we’re backing them with government funding to use the latest technologies to cut their emissions and their reliance on fossil fuels – helping to future-proof these industries as we grow our green economy.

This will not only cut their energy costs but also boost their competitiveness on the world stage, helping them thrive and protecting the thousands of jobs they offer across the country.

Matt Callan, Senior Director Supply Chain at Heineken UK, said:

We are proud to have ambitious targets when it comes to reducing our carbon footprint, within both our own operations and across our entire value chain. For over 150 years, we have been passionate about making a positive impact and more than ever it is clear that there is no time to waste in taking action to reduce carbon emissions.

This investment and IETF funding will enable us to act faster, and with the commitment and passion of our colleagues and partners, will help us raise the bar at our Manchester Brewery to brew our beers in a more sustainable way.

The project will make a significant contribution on our journey to carbon neutrality and provide us with the learnings to reapply across our other sites as we continue our journey to brew a better world.

Phil Makin, Technical Development Manager at Kellogg UK said:

The Industrial Energy Transformation Fund is enabling our Wrexham site to unlock future sustainability savings and benefits, whilst driving down our overall carbon footprint and helping towards Kellogg's 2030 carbon neutral target.

Sarah Webster, Britvic's Sustainable Business Director, said:

We are passionate about delivering on our ambition to be net zero by 2050, and we are pleased to have reduced our direct emissions by over 30% since 2017.

We want to go further faster, but we can't do it alone. Alongside our sustainable investment programme, this IETF grant will help us reduce our carbon emissions at our much-loved London site by a further 50%.

This will benefit our employees, the local community, our customers and consumers who can feel reassured that we take our environmental responsibilities seriously.

A total of £289 million is being made available to businesses through the IETF up to 2027 and today's allocations take amount awarded under the scheme so far to £61.4 million.

Today's announcement builds on the wide-ranging support that has been made available to energy-intensive industries. This includes:

The Industrial Energy Transformation Fund is one of many schemes that form part of the government's commitment to reduce overall UK energy demand by 15% by 2030, alongside the wider ambition for the UK to move towards greater energy independence.

Full list of recipients are as follows:

Greg Methven, UK Operations Director, Ardagh Glass, which is receiving £1.7 million to develop a new glass production furnace, said:

Ardagh Glass Packaging - Doncaster's Efficient Furnace project will improve efficiency at the facility while reducing its carbon footprint. The grant support provided has been a key enabler in upgrading the project from a standard cross-fired furnace to more energy efficient end-fired furnace technology.

Greg Hewitt, Managing Director of Rock Chemical Limited, which is receiving over £100,000, to install technology that blends chemicals using ultrasound instead of being powered by diesel, said:

We’re thrilled to have been awarded a grant to support our sustainability goals. Adopting ultrasound blending technology will help us reduce our carbon footprint while maintaining the quality of our products, which is paramount to us.

This innovation aligns with our commitment to achieving net-zero manufacturing and offers benefits above and beyond the environmental aspects, including increased efficiency and reduced manufacturing costs. We’re proud to take this step towards a greener future for our business and the planet.

Find more information on the IETF and the 26 winning projects announced today.

The Scottish Government is administering £34 million (£26 million from the IETF budget announced in 2019) for investment in Scotland and launched the Scottish IETF in December 2020.

An extension to the IETF was announced in the recent Powering up Britain document, increasing total grant available to 2028 by £185 million. Subject to business case approval, Phase 3 of the IETF will open for new applications in early 2024.

Wider government funding and support for energy intensive industries includes:

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