Elkem Curtails Production in Norway Due to High Power Prices

Elkem ASA - a company that produces silicon-related products world wide and is based in Northern Norway - has decided to partially curtail its production in Norway by temporarily shutting down two furnaces - one at Thamshavn and one at Rana.

This is due to high power prices. Elkem is well-positioned with long-term power contracts securing the company's electricity consumption in Norway.

However, in the current market, curtailing production enables the company to optimise value creation by selling its power at highly attractive rates in the Norwegian power market. The decision will have no impact on customers or employees.

"In the short term, this is a win-win: By reducing some of our production, we can optimise value creation for Elkem and contribute to increased flexibility in a tight power market for households and businesses in Norway. We will use this time to bring forward maintenance and improvement work at our plants to position for the future", says Elkem's CEO Helge Aasen in a statement.

"In the long term, however, we are concerned about what the current situation says about Norway's ability to provide competitive power to households and businesses. It should not be more profitable to sell power than to produce critical materials for the green transition. We see a huge potential to leverage Norway's surplus of renewable hydropower as a competitive advantage for existing and new green value chains, as we have done since the early 1900s, but securing this requires political action" says Aasen.

The two furnaces are expected to remain shut until early first quarter 2023. Elkem's plant in Thamshavn mainly produces silicon while the plant in Rana mainly produces ferrosilicon. Elkem has twelve furnaces in total in Norway and temporary curtailments to sell power may also be relevant at other sites, depending on market developments.