Hydro sanctions largest hydropower investment in two decades for aluminium production

Norsk Hydro has made a final investment decision to construct the Illvatn pumped-storage hydropower plant in Luster municipality, Norway. This represents Hydro's largest hydropower investment in over 20 years, with construction commencing in November 2025 and operations expected by 2030. The project carries a gross investment of NOK 2.5 billion, with Hydro's net investment after tax estimated at NOK 1.2 billion, thanks to the cash flow tax scheme for hydropower investments.

The new plant is projected to deliver an additional 107 GWh of renewable energy annually, specifically allocated to Hydro's aluminium production. The project involves pumping water between Fivlemyrane and Illvatn reservoirs, increasing storage capacity and optimizing winter production. Additionally, Hydro will build a new 13-kilometer power line featuring 48 aluminum power masts, a sustainable alternative to traditional materials.

Kari Ekelund Thørud, executive vice president of Hydro Energy, emphasized the project's role in boosting energy production and flexibility within the Fortun system. This investment supports Hydro's goal of achieving net-zero nature loss and contributes to securing competitively priced power for its Norwegian aluminium smelters, underpinning Norway's industrial development and its target of producing zero-carbon aluminium by 2050.