Norwegian aluminium and renewable energy company Hydro Energi has reached an agreement for the voluntary termination of its long-term power purchase agreement (PPA) with Cloud Snurran.
The company entered the long-term PPA with Cloud Snurran in 2018. It involved an annual baseload supply of 300 gigawatt hours (GWh) from 2020 to 2030, increasing to 550GWh from 2031 to 2049.
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The contracted power volumes to Hydro Energi have not been delivered since November 2024 after Cloud Snurran experienced financial challenges.
On 17 July 2024, the Svea Court of Appeal approved the application submitted by Cloud Snurran’s for reorganisation under the Swedish Restructuring Act, reversing a previous ruling by the Stockholm District Court.
The reorganisation process is now terminated, leading to a settlement in which Hydro will receive compensation up to €90m ($104m). This sum accounts for both undelivered energy and anticipated future deliveries.
The compensation package is subject to realised values from upcoming sales processes and an established value-sharing arrangement.
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By GlobalDataDespite this development, Hydro Energi maintains a strong sourcing position for its Norwegian smelters through to 2030. With an average annual equity hydropower production of 9.4 terawatt hours (TWh) and around 8.5TWh per year from existing contracts, its energy supply remains secure.
As current long-term agreements approach expiration at the end of 2030, Hydro Energi is exploring various options to secure the cost-effective renewable energy sources essential for its operations’ continuity.
The finalisation of this settlement hinges on meeting specific closing criteria and is projected to take effect in July 2025.
In April 2024, Hydro Rein, Atlas Renewable Energy, and Albras, a joint venture between Hydro and Nippon Amazon Aluminium, commenced operations at the 438MW Boa Sorte solar plant located in Paracatu, Minas Gerais, Brazil.
