By William James
LONDON (Reuters) - Britain promised on Wednesday to start refunding the cost of so-called green taxes which push up energy costs for steel manufacturers and other energy-intensive industries as soon as the European Union grants state aid approval.
This month over 4,000 British steel jobs have been lost or are at risk due to a combination of weak prices and high costs, pushing the issue up the political agenda and prompting demands from the industry for more government support.
Producing steel profitably is especially difficult in Britain due to a strong currency and high energy costs. The environmental taxes imposed on heavy industry are also some of the highest in the world.
"We will refund the energy-intensive industries with the full amount of the policy costs they face as soon as we get the state aid judgment from Brussels," Prime Minister David Cameron told parliament.
The pending state aid request relates to the Renewables Obligation, which is the government's main incentive mechanism for large-scale renewables projects.
The government had previously planned to start making the refunds from next April, but now intends to start paying out as soon as the EU approves the request.
A government spokesman said the current expectation was for the approval to be granted by the end of the year, with payments worth around 15 million pounds per month.
British energy-intensive industries such as steel paid 80 percent more for electricity in the first half of 2015 than the EU average, which is itself about two times higher than the United States.
But the steel sector says its biggest problem has been a sharp rise in steel imports from China, which has excess production as its economic growth rate slows
