Norwegian energy giant Hydro has committed 1.2 billion kroner to build a new pumped storage power plant in Sogn, marking the company's largest hydropower investment in two decades. The Illvatn facility in Luster municipality represents a major step in addressing Norway's growing energy demands.
Hydro CEO Eivind Kallevik confirmed the final construction decision, stating that ground will be broken shortly. The project will be located approximately 600 meters inside a mountain near the existing Fivlemyr power plant and will include construction of a new tunnel system.
This pumped storage hydropower development will better utilize water resources and help manage market fluctuations. The system allows increased winter production while storing more energy during summer months by optimizing reservoir capacity. Beyond improving flexibility in the Fortun power system, the plant will add 0.1 TWh annually to Norway's total energy production of 155 TWh.
Hydro's substantial energy requirements for its aluminum smelters in Sunndal, Husnes and Karmøy have driven the company's push for expanded capacity. Kallevik emphasized that without such developments, Norway faces potential power shortages in the coming years.
The timing reflects changing energy market dynamics. Kari Ekelund Thørud, Hydro Energy's director, noted that seasonal price variations between summer and winter now make such projects economically viable. The Illvatn project has been in Hydro's portfolio for twenty years before reaching this implementation phase.
Environmental considerations remain central to the development. Hydro collaborates with Fornybar Norge to minimize natural habitat disruption, aiming for net zero loss of prioritized nature areas. This approach sets new standards for future hydropower projects in Norway.
Despite this major investment, Kallevik acknowledges that hydropower alone cannot meet Norway's future energy needs. Land-based wind power must play a crucial role, though few new concessions have been granted recently. The energy sector and industry must collaborate to bring more power to market.
Norway's energy landscape is evolving rapidly. New data centers from Google in Skien and TikTok in Hamar and Løten will consume substantial power, alongside electrified oil and gas projects including Troll, Oseberg, Draugen and Yggdrasil. These developments create both challenges and opportunities for Norway's industrial future.
Kallevik stresses the importance of timely decisions. Whether power shortages emerge in 2030 or 2032 matters less than taking action now to prevent them. The Illvatn project represents one contribution toward securing Norway's energy independence while maintaining competitive pricing for industry.
The project begins construction in November with operational start expected by 2030. Hydro continues evaluating additional hydropower upgrades and wind power developments, though each project must balance energy needs against environmental considerations including vulnerable nature areas and wild reindeer habitats.