I have to wonder how that would work.
I don't know anything about Truecrypt or about encrypting drives in general, but I saw this at their web site FAQ;
I forgot my password ? is there any way ('backdoor') to recover the files from my TrueCrypt volume?
TrueCrypt does not allow recovery of any encrypted data without knowing the correct password or key. We cannot recover your data because we do not know and cannot determine the password you chose or the key you generated using TrueCrypt. The only way to recover your files is to try to "crack" the password or the key, but it could take thousands or millions of years (depending on the length and quality of the password or keyfiles, on the software/hardware performance, algorithms, and other factors). If you find this hard to believe, consider the fact that even the FBI was not able to decrypt a TrueCrypt volume after a year of trying.
So it seems best not to forget your password.
But in answer to your question, yes the drive can be formatted if you forget the password. Everything will be lost.
I assume Acronis will be able to restore a previously created backup, and it has the option to do this from a special boot disk, but if you are restoring an encrypted drive and do not have the password, I fear that will not help you much.
Not what you wanted to hear, I'm sure.
I've been thinking about encrypting my system hard drive, a regular 500GB Serial-ATA drive, with an AES encryption. I've searched their main site, and forums, but I can't seem to find an answer. Here is my question:
In case I forget my password can I format the drive normally?
Basically saying that can I do a full format and use the hard drive without the encryption in case of loss of password, and I can use my Acronis backup image to get everything back.
I've taken necessary steps to backup:
I backed up my system with Acronis, the whole system drives including partitions of the system drive.
I'm setup on a rig with a RAID 0 so I have two separate hard drives.
My hardware specs:
Windows 7 Ultimate 64-bit
8 GB RAM
Intel Core i7 1.73 GHz Quad
Two 500GB Hard Drives Serial-ATA