Slovalco began restarting primary aluminium production in late August 2026 in Slovakia after suspending it in 2022. The programme is budgeted at approximately €100 million and initially targets 75,000 tonnes of annual capacity at the Žiar nad Hronom smelter. Separately, Norsk Hydro has reported producing aluminium for the first time using HalZero, an electrolysis technology intended to avoid direct carbon dioxide emissions.
Slovalco restart timeline and output targets
Slovalco suspended primary production following sharply higher electricity prices and insufficient compensation for indirect carbon costs, which weakened competitiveness. The restart followed an agreement that sets revised operating conditions and is expected to support more than 200 jobs. The first phase targets 75,000 tonnes of annual production by February 2027, compared with total installed capacity of approximately 175,000 tonnes.
Hydro holds 55.3% of Slovalco, while Penta Investments owns the remaining 44.7%. A subsequent phase could restore another 100,000 tonnes of annual capacity, depending on electricity arrangements and regulatory conditions beyond 2030. Restored output is described as potentially improving access to regional metal supplies for European automotive manufacturers, electricity-network suppliers and renewable energy companies as demand for lower-carbon materials increases.
Electricity contracts and indirect EU ETS cost compensation
A long-term electricity purchase agreement with Slovak state-owned Vodohospodárska výstavba provides Slovalco with greater visibility over future power costs. The framework includes compensation for indirect carbon costs when generators pass EU ETS 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 facilities using relatively low-carbon power can face indirect carbon-cost exposure through their electricity purchases. Aluminium is covered by the European Union’s Carbon Border Adjustment Mechanism (CBAM), but CBAM does not directly remove the electricity-cost disadvantage faced by European smelters. As a result, competitive power contracts and compensation for indirect carbon costs remain relevant to domestic production.
Norsk Hydro’s HalZero production at Porsgrunn
Norsk Hydro disclosed its first HalZero aluminium production in its third-quarter results after work at its Porsgrunn research facility in Norway. Hydro said the technology is designed to replace the Hall-Héroult electrolysis process, which has been used for more than a century. In conventional production, carbon anodes react with oxygen released from alumina and generate carbon dioxide.
Hydro said HalZero first converts alumina into aluminium chloride before processing it through electrolysis intended to keep chlorine and carbon in closed loops. The approach is intended to eliminate direct CO2 emissions associated with consuming conventional carbon anodes. Developed since 2016 with Norwegian research institutions including NTNU and SINTEF, the core process has produced aluminium beyond laboratory conditions.
The alternative technology is not yet commercially ready. Hydro stated that 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 main stages and test operational reliability, energy consumption, equipment durability and product quality.
Funding status and deployment timetable for HalZero
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 has announced neither a final investment decision nor a commercial deployment timetable.
The company said HalZero still needs to demonstrate lower emissions alongside competitive investment costs, operating expenses and production performance at industrial scale.
Hydro third-quarter results and capital spending guidance
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. 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, maintaining investment discipline despite stronger earnings. Slovalco’s production restart has a nearer-term commercial timetable, while HalZero remains a research and development programme requiring further industrial testing.