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Hydro announced on August 24 a power purchase agreement with Statkraft for 876 GWh of annual supply from 2031 through 2040. Delivery is assigned to Norway’s NO5 electricity price area. The company describes approximately 8.8 TWh over the contract period. These are contracted future energy volumes, not electricity already consumed by aluminium plants in 2026. The release does not disclose a tariff from which a buyer could calculate Hydro’s smelting cost.
Annual energy and instantaneous power must also remain distinct. A contract expressed in GWh specifies an energy quantity; it does not establish that the same amount of power is available at every hour of a plant’s operation. Delivery profiles, balancing responsibilities and outage provisions matter when matching supply to electrolysis demand. Converting the annual volume into an average power equivalent can clarify scale, but cannot replace the agreement’s hourly terms or prove firm grid access.
For aluminium production, electricity is an operating input whose availability and pricing can affect plant economics over many years. A long agreement may improve the visibility of part of the procurement portfolio without fixing every expense. Alumina, anodes, labour, maintenance and transport still have their own contracts. Nor does the electricity agreement establish a discount in a customer’s metal invoice: the selling formula and the producer’s procurement arrangements can have different timing and exposure.
The industrial question is therefore how the contracted volume fits the residual requirement. A useful comparison would separate existing generation, other purchase agreements and exposed market purchases, with the same plant boundary and delivery period. Financial assessment also needs indexation, currency, collateral, flexibility and counterparty obligations. None of those terms should be invented from the press release. As of October 9, the August announcement establishes a dated future supply commitment. It supports examining the relationship between power sourcing and aluminium continuity, while leaving realized prices, actual deliveries and plant-level cost effects for later evidence. Buyers can use that distinction to ask more precise supplier questions without treating an undisclosed power contract as a published energy price.