Hydro Energi AS, a leading aluminium producer, has signed a new long-term power purchase agreement (PPA) with Hafslund Kraft AS that will supply 3.5 TWh of renewable electricity between 2031 and 2040. The deal secures 350 GWh per year for Hydro’s Norwegian smelter system, with delivery fixed in price area NO3. This adds another building block to Hydro’s long-running effort to lock in stable, green power for energy-intensive aluminium production.
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A strategic contract in a tightening Nordic power market
Long-term PPAs of this scale are becoming rarer in the Nordic region as hydrology grows more volatile and as developers weigh merchant exposure against fixed-price agreements. Hydro’s decision to secure supply for more than six years in the future shows how crucial predictable renewable power has become for metals producers facing intense decarbonisation pressure.
Kari Thørud, Executive Vice President of Hydro Energy, underscored this point. “We are pleased to announce this long-term contract with Hafslund. Renewable energy is instrumental to our efforts to produce aluminium with low carbon emissions and deliver a strategic raw material for European industry,” she said.
Hydro’s aluminium made in Norway already carries a carbon footprint roughly 75 per cent below the global average. This gap matters as European buyers increasingly differentiate between low-carbon and conventional metal. The PPA strengthens Hydro’s ability to meet that premium demand while progressing its technology roadmap toward zero emissions by 2050.
Also Read: SWG collaboration: Today’s economic pathway to net-zero alumina
Hafslund’s role and why NO3 matters
Hafslund, Norway’s second-largest power producer, brings scale and reliability. Its 83 hydropower plants and a growing wind portfolio that produce 22 TWh annually, serving more than three million people. Allocating part of that output to industry helps stabilise regional load and supports long-term investment signals in NO3, a Norwegian grid price zone, where industrial demand is rising faster than generation growth.
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