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Levy 'could spell death' of UK cement industry

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UK CEMENT producers have returned empty handed from a key meeting with Government on a 'green levy' which is said to threaten the future of cement manufacture in the UK.

The British Cement Association met with the Department of the Environment Transport and the Regions and its consultants ETSU last Friday. The meeting was called to discuss the controversial Climate Change Levy, which is intended to cut CO2 emissions by encouraging greater energy efficiency and reduced fossil fuel use by manufacturing industries.

The cement industry claims the full levy would cost it more than £40M a year, making it unable to compete with foreign imports once the tax comes into force in April 2001.

'The levy could sound the death knell to the whole UK cement industry,' said one insider. 'European producers who have a much more relaxed legislative framework would be able to land cement here at prices we couldn't match.'

The industry was seeking a reduction of more than 90%. But the BCA said that 'no decisions were finalised', and the DETR would say only that the meeting had been 'constructive and helpful'.

Cement producers have been making two key points to the DETR during the course of the negotiations. The first is the major effort already made to improve energy efficiency, including new works and the switch from wet process kilns to the more efficient dry kilns.

Second, say the producers, their increasing use of waste-derived fuels such as old tyres and packaging offcuts not only saves fossil fuels but reduces the pressure on landfill sites.

Originally the deadline for agreement on the levy was the end of October, to give Government time to present detailed proposals in next year's spring budget. This has been extended to 20 December.

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