ENERGY IN ICELAND - Orkustofnun

1 IntroductionDuring the past century, Icelandtransformed itself from an impoverishednation to a land of plenty.Harnessing domestic energy and theavailability of energy resources forindustrial and public consumptionplayed a major role in this development.It was, in fact, a preconditionfor economic development.Oddur SigurðssonA geothermal area near Hrafntinnusker in mid-Iceland.There were a number of stages alongthe way to prosperity, most notablythe mechanization of fisheries, andlater agriculture, and the developmentof a communications infrastructure.These advancements werefollowed by the development of generalutilities, electrification of townsand rural areas, and the creation ofgeothermal district heating services.Thanks to the latter, most Icelandersenjoy inexpensive heat from geothermalsources.Around the middle of the 20th century, efforts to utilize the country’s energy resourcesfor power intensive industry began. The largest single effort was the constructionof the Alusuisse aluminum plant, ISAL, (owned by Alcan since 2000) in Straumsvik,just south of Reykjavik, in 1969. The hydroelectric power was harnessed from a glacialriver in the Burfell power station. As the end of the 20th century approached, anew era dawned with the growth of Iceland’s power intensive industry. That growthcontinues today. Electricity production was 8.7 TWh in 2005 and is expected to in-