Slovalco began restarting primary aluminium production in late August 2026 in Slovakia after suspending output in 2022. The programme is budgeted at about €100 million and initially targets 75,000 tonnes of annual capacity at the Žiar nad Hronom smelter. Separately, Norwegian producer Norsk Hydro reported producing aluminium for the first time using HalZero, an electrolysis approach intended to avoid direct carbon dioxide emissions.
Slovalco restart programme and capacity targets
Slovalco suspended primary production after sharply higher electricity prices and insufficient compensation for indirect carbon costs reduced competitiveness. The restart follows an agreement that sets revised operating conditions. The company expects the move to support more than 200 jobs.
The first phase of the restart is aimed at reaching 75,000 tonnes of annual production by February 2027. This is set against total installed capacity of approximately 175,000 tonnes.
Hydro holds 55.3% of Slovalco, while Penta Investments owns the remaining 44.7%. A later phase could add another 100,000 tonnes of annual capacity, depending on electricity arrangements and regulatory conditions beyond 2030.
The source framework also links potential output restoration to improved access to regional metal supplies for European automotive manufacturers, electricity-network suppliers and renewable energy companies. This is described as relevant as demand grows for lower-carbon materials.
Electricity contracts and indirect EU ETS cost compensation
A long-term electricity purchase agreement with Slovak state-owned Vodohospodárska výstavba is intended to give Slovalco greater visibility over future power costs. The wider framework includes compensation for indirect carbon costs when generators pass EU Emissions Trading System expenses through to wholesale electricity prices.
The agreement was conditional on European Commission approval of the revised Slovak compensation scheme. Aluminium smelters require continuous, electricity-intensive operations, and even plants using relatively low-carbon power can still face indirect carbon-cost exposure through electricity purchases.
CBAM covers aluminium under the European Union’s Carbon Border Adjustment Mechanism, but it does not directly address the electricity-cost disadvantage faced by European smelters. Competitive power contracts and compensation for indirect carbon costs are therefore described as important for domestic production.
Norsk Hydro’s HalZero production at Porsgrunn
Norsk Hydro disclosed its first HalZero aluminium production in its third-quarter results. The work followed activity at its Porsgrunn research facility in Norway.
The technology is designed to replace the Hall-Héroult electrolysis process used for more than a century. In conventional production, carbon anodes react with oxygen released from alumina and generate carbon dioxide.
HalZero begins by converting alumina into aluminium chloride before processing it through electrolysis intended to keep chlorine and carbon in closed loops. Hydro said this approach is intended to eliminate direct CO2 emissions associated with consuming conventional carbon anodes.
The core process has been developed since 2016, including with Norwegian research institutions such as NTNU and SINTEF. Hydro stated that the process has produced aluminium beyond laboratory conditions.
Status of industrial readiness and public funding for pilots
The alternative technology is not yet commercially ready, according to Hydro. The company said current tests still generate some carbon dioxide because all processing stages have not been integrated into a closed-loop system.
The next phase will integrate the main stages and test operational reliability, energy consumption, equipment durability and product quality. Hydro has not announced a final investment decision or a commercial deployment timetable.
A Norwegian state-owned agency, Enova, provided approximately €13.5 million in 2023 for the existing research facility, which began operating in January 2026. Enova later awarded another €7.8 million for engineering and planning a larger industrial pilot, but that funding does not approve construction.
Hydro third-quarter results and capital spending outlook
Hydro reported third-quarter adjusted EBITDA of approximately €868 million, up from €573 million a year earlier. Higher aluminium prices, strong Norwegian production and improved recycling and extrusion earnings supported the result.
The company said Norwegian smelters achieved record liquid-metal production while stronger margins supported downstream operations. Free cash flow was approximately €134 million, reflecting increased working-capital requirements.
Hydro reduced its full-year capital expenditure guidance from €1.29 billion to approximately €1.19 billion. Slovalco’s restart is described as having a nearer-term commercial timetable, while HalZero remains a research and development programme requiring further industrial testing.