Hydro receives $17.4 million in the form of Inflation Reduction Act tax credit

The U.S. Department of Energy has awarded Norway-based Hydo $17.4 million in the form of a tax credit under the Inflation Reduction Act’s Section 48C Qualifying Advanced Energy Project tax credit program for its Henderson, Kentucky, aluminum recycling plant. The award followed a competitive process that involved more than 800 different potential projects around the U.S.

Announced by Hydro in May 2024, the HyForge project expands on the automotive-focused production at the company’s Henderson recycling plant. Hydro says the new HyForge line also is backed by tax incentives from the Kentucky Economic Development Finance Authority. The new casting line will increase capacity at the plant by 28,000 metric tons to 118,000 metric tons annually and create more than 30 jobs in Henderson.

The company’s HyForge technology, which has been implemented at the Hydro Husnes primary aluminum plant in Norway and the Hydro Rackwitz recycled-content plant in Germany, enables the extrusion of aluminum cast forge stock with a smaller diameter and with a superior surface quality than traditional billets. “It can be forged directly into high-quality automotive components, like wheel suspension parts, without adding any further process steps such as extrusion or homogenization,” the company has said of the HyForge process.

“We appreciate the support from the Department of Energy and the Department of the Treasury as well as their recognition of how Hydro’s recycling initiatives in the U.S. support strengthening supply chains for OEMs [original equipment manufacturers] in America with domestically produced, low-carbon materials,” says J. Duncan Pitchford, president of Hydro Aluminum Metals USA.

“This award acknowledges not only the groundbreaking technologies being deployed by Hydro but also broad support from local and regional stakeholders for Hydro’s continued investment in the Henderson community,” he adds.

Using high percentages of end-of-life scrap, HyForge production at Henderson will deliver products with a carbon footprint more than 30 percent lower than the existing products in the U.S. market, Hydro says. Because HyForge also eliminates a production step traditionally required for automotive forging stock, it also delivers cost-competitive solutions for automakers as they look to further lightweight their vehicles. 

The company says the HyForge project will become operational following a two-year construction period, enabling Hydro to supply the U.S. automotive market with high-quality automotive components, meeting its need for smaller diameter, high-quality forging stock that can be forged directly into high-quality automotive components.

Aluminum’s strength-to-weight ratio allows it to replace heavier materials, saving costs and emissions, the company says, and its low maintenance properties, durability and resistance to corrosion result in long-term resource savings.