Slovalco has reached an agreement with the Slovak government to restart 75,000 tonnes of curtailed primary aluminium production capacity, marking a major step toward restoring European aluminium supply following the shutdown of operations in 2022 due to high electricity prices.

The agreement establishes the framework required for the restart, including a compensation scheme for indirect carbon costs (ICC) under the EU Emissions Trading System (ETS). Slovalco has also secured a long-term power purchase agreement (PPA) with Vodohospodárska výstavba, š.p., supporting more predictable energy costs for the energy-intensive smelting operation.

The restart is subject to approval of Slovakia’s updated ICC compensation scheme by the European Commission. Once approved, Slovalco will invest €100 million to restart production, supporting more than 200 jobs in the Žiar nad Hronom region. Aluminium production is expected to resume in the fourth quarter of 2026.

The initial restart will restore 75,000 tonnes of the plant’s total 175,000 tonnes per year production capacity. The remaining 100,000 tonnes will depend on future conditions after 2030, including additional electricity contracts and competitive industrial policies.

Hydro, which owns 55.3% of Slovalco, said the restart will strengthen Europe’s industrial resilience by reducing dependence on imported aluminium. The company highlighted that around 50% of EU aluminium production capacity has been curtailed since 2022 due to energy costs and global competition. The remaining 44.7% of Slovalco is owned by Penta Investments Group.