Hydro and Statkraft Ink Massive 10-Year Power Deal to Decarbonize Aluminium Production
In a strategic move to secure industrial competitiveness and advance its sustainability goals, Hydro Energi AS and Statkraft have entered into two long-term power purchase agreements (PPAs) to fuel primary aluminium production in Norway. The agreements ensure a total energy supply of 12.3 TWh over a decade, underscoring the critical intersection of energy security and heavy industry innovation.
The delivery schedule is structured to scale over the next several years. For the 2029 and 2030 period, the agreements commit to a total delivery of 0.9 TWh per year. Starting in 2031 and continuing through 2038, the volume will increase to 1.3 TWh annually. This energy will be distributed across two specific pricing zones, with 8.8 TWh allocated to the NO2 price area and 3.5 TWh to NO3.
This massive energy procurement is a cornerstone of Hydro’s broader technology roadmap to achieve zero emissions by 2050. By leveraging renewable energy, the company is able to produce aluminium in Norway with a carbon footprint approximately 75 percent lower than the global average. This transition to low-carbon production is increasingly vital as global markets demand more sustainable industrial solutions.
“This agreement underlines how power and industrial development are closely linked in Norway. Together with Statkraft we are strengthening the long-term competitiveness of our aluminium operations. Aluminium is critical across the economy and access to power at competitive prices is essential to deliver future low-carbon solutions for our customers,” said Eivind Kallevik, President and CEO of Hydro.
The partnership emphasizes the role of national energy producers in supporting domestic industry. Birgitte Vartdal, President and CEO of Statkraft, noted that as Norway’s largest power producer, a primary objective is ensuring electricity availability for Norwegian industrial players. Vartdal stated that Statkraft is pleased to meet Hydro’s needs on competitive terms, thereby extending a long-standing partnership through these new contracts.
This agreement is part of a wider, aggressive strategy by Hydro Energi AS to diversify and secure its power portfolio. In March 2026, the company signed a PPA with Alpiq for 219 GWh annually from 2031 to 2038, totaling 1.75 TWh in the NO3 price area. A December 2025 agreement with Hafslund Kraft AS secured 1.75 TWh between 2036 and 2040, providing an annual supply of 350 GWh in the NO3 area. Together, the partnership with Hafslund marks the eighth PPA signed since 2020, totaling approximately 10 TWh.
Beyond these external contracts, Hydro continues to invest in its own captive renewable energy portfolio and the development of new renewable power projects. This multi-pronged approach to energy procurement signals a growing trend among industrial giants to hedge against energy volatility while aggressively pursuing decarbonization targets.
