Ongoing Energy Cost Crisis – Lack of urgent Government action: CPI raises concerns over reports that eventual support could be in the form of cost deferral 

20 October 2021

The Confederation of Paper Industries (CPI) represents the whole of the UK paper cycle – from papermaking to conversion into ready to use product, and collections ready for recycling back into new paper.   The COVID-19 lockdown illustrated how important paper-based products are to keeping the economy functioning – from packaging for food, drink, and medicines to hygiene products.   

While all parts of the sector are wrestling with the huge increase in energy costs, papermaking is intrinsically energy intensive. Cost increases of the current magnitude are not sustainable and there is no sign that the current gas cost crisis (and its impact on electricity prices) is coming to an end.  Indeed a number of market experts now expect the crisis to continue through the whole of winter.     

The Government therefore needs to act urgently to address the crisis and prevent production being disrupted and longer-term damage to companies.       

The paper sector is one of the Energy Intensive sectors (alongside steel, chemicals, ceramics, cement and glass) that has been in discussion with Kwasi Kwarteng and his officials.  

Andrew Large (Director General) commented:Andrew Large

“We’re heartened that there’s an understanding within BEIS about the need for urgent action and we understand proposals have been put forward to the Treasury for its consideration.  

“However the lack of any actual action is of concern and implies the urgency of the issue is not understood at the highest levels of Government.   We also understand that Treasury is leaning to supporting business loans that – at best – simply push the issue away for a short time until the loans need to be repaid.   

“UK industry needs a comprehensive set of actions that address both the urgency of the current price crisis, but also resets the energy market so that UK industry pays the same for energy as our competitors based in the EU.”  

In common with our colleagues in other sectors, CPI is calling for action in a number of areas:
  • Introducing immediate Winter Cost Containment Measures on gas, electricity and carbon prices – to ensure that those most exposed to high costs can continue to operate. These measures must genuinely reduce costs to business, and not merely push them into the future. 
  • Action to reduce Energy Intensive Installation network costs – so they move into line with costs faced by competitors outside the UK.
  • Support for companies so they can remain competitive as the UK economy decarbonises – we need global actions to address climate change. 
  • Modifying the Gas Emergency Measures – so that sufficient gas is available and there are no emergency or sudden supply disruptions that can damage equipment.


Contacts for further information

Holly Whitbread | [email protected] | 01793 889612
Emma Punchard | [email protected] | 01793 889609

Notes to Editors
CPI is the leading trade association representing the UK’s Paper-based Industries, comprising paper and board manufacturers and converters, corrugated packaging producers, makers of soft tissue papers, and collectors of paper for recycling.

CPI represents an industry with an aggregate annual turnover of £12 billion, with 56,000 direct and a further 93,000 indirect employees.

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