"To be a winner in the aluminium industry, we must be the best in technology and operations. So we are working intensely to further develop and test the aluminium technology of the future – the world's most energy-efficient and with the lowest CO2 footprint," says Hydro President and CEO Svein Richard Brandtzæg.
"At the moment, there is overproduction and inventories of aluminium are large. Any investment in new capacity will obviously be an element in evaluating of profitability and market balance," says Brandtzæg.
|BEST: "To be a winner in the aluminium industry, we must be the best in technology and operations," says President and CEO Svein Richard Brandtzæg, here pictured at Hydro's fourth quarter 2012 presentation. (Photo: Øyvind Breivik)
The conditions for continuing and developing aluminium production in Norway have improved in recent years. Development of renewable energy capacity has increased power supplies and conditions for more competitive power prices. In addition, compensation for CO2 costs in power prices are producing better conditions for industry.
CO2 emissions from aluminium produced with coal-fired power are up to five times higher than for aluminium produced with hydropower. This makes producing aluminium in Norway even more attractive.
Testing the world's most energy-efficient aluminium technology
Hydro technology center in Årdal is a leader in developing new and more energy-efficient cell technology. It is this technology, together with new anodes and raw materials, that Hydro wants to test at a large new pilot plant. If the pilot project is realized, Karmøy will host the most energy-efficient aluminium production in the world.
Brandtzæg emphasizes that there are a number of elements that must fall into place before Hydro can break ground. The power grid in the region must be dimensioned to meet the demands of the offshore industry and industrial development. The company must also secure enough power under competitive conditions and establish an agreement with Enova on financing, in which Enova can contribute considerable – and crucial – support.
Enova has launched a program for supporting new energy and climate technology in industry. That is the background for a dialog between Hydro and Enova on how they together can develop groundbreaking new technology that can reduce energy consumption and emissions from Norwegian industry.
Enova is owned by the Norwegian Ministry of Petroleum and Energy and has as its goal to promote environmentally friendly alternatives in energy consumption and energy production in Norway.
Backbone of Hydro's production system
Brandtzæg points out that the Norwegian aluminium plants, which account for about half of the company's production, make up the backbone of Hydro's production system. He says that in recent years, all of the Norwegian plants have been working systematically to improve their cost position and improve their operations.
The plants in the region of Sogn can supply the rolled products segment. Sunndal is designed for high volumes and low cost in products for extrusion plants and casthouses. Karmøy is to supply special segments in extrusion and wire rod and Årdal Karbon will be developing production of next-generation anodes.
"Our ambition is to maintain and develop all our plants in Norway," Brandtzæg says.
"All of the Norwegian plants play an important role in Hydro's global production system. This is where we have leading competence, where we are developing and improving production every day, and where we are developing new technology."
|KARMØY: Aerial photo of Hydro's aluminium plant at Karmøy, taken in September 2012 just prior to clean-up of the demolished Søderberg facility.