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Iceland

Official Name:
Republic of Iceland

Energy profile

Iceland (2013)

Type: 
Energy profile
Energy profile
Extent of network

The Icelandic electrical system is an isolated system without any connection to other countries. Virtually all inhabitants of Iceland except those living on small islands off the coast and on remote farms, are connected to a single transmission system through six distribution networks. In 2010 the transmission system consisted of approx. 3,169 km of high voltages lines (33, 66, 132 and 220 kV) and around 70 substations and transformer stations.

Renewable energy potential

So far only a portion of Iceland’s renewable hydro- and geothermal energy resources have been harnessed (approx. 20–25% of the total and probably around 40-50% when environmental concerns have been taken into account). In addition, Iceland may offer interesting possibilities for large-scale wind power generation.SolarIceland has relatively low insolation, due to the latitude, about 20% less than Paris, and half as much as Madrid, with very little in the winter. Unlike geothermal, solar power is a non-dispatchable renewable energy source - the sun follows a predictable path but the weather is not controllable. This makes both wind power and solar power variable renewable energy (VRE) sources.

Wind Energy

According to the categories established in the European Wind Atlas (Troenand Petersen, 1989), the wind energy potential of Iceland is in the highest class. Although wind energy cannot be expected to replace hydro-and geothermal energy, it can be a valuable addition. For example, a modest wind farm of 15 EnerconE44 turbines installed on Hellisheiðiwould produce more energy than the smallest currently operational hydro-and geothermal power plants in Iceland together.

Biodiesel

To date there has not been a heavy emphasis on biodiesel in Iceland. However, a new biodiesel plant was constructed recently in the northern town of Akureyri, Iceland’s second-largest urban area. It will use waste vegetable oil and animal fat as feedstock. The plant was designed by the Icelandic engineering firm, Mannvit.Biodiesel is produced from waste fat derived from food production or energy crops. The biodiesel can be blended with normal diesel oil and thus easily be distributed through the current infrastructure. The advantages of Icelandic biodiesel production and use are twofold: lower carbon emissions and domestic production, both of which result in increased energy independence and less dependence on imported fossil fuels. The biodiesel from the plant in Akureyri is blended with normal diesel fuel. It will mostly be used to power Akureyri’s public transport system. However, the local fisheries sector has also started using this green fuel for trawlers.There are a few other ongoing startup projects in the Icelandic biodiesel industry. Making biodiesel from rapeseed is one option. Rapeseed oil is a well-known biofuel and can be substituted for diesel fuel.

Geothermal

Due to geophysical conditions, Icelandic geothermal power is a reliable base load and a low cost option for electricity generation. Geothermal plants now account for approximately one-quarter of all electricity generated and consumed in Iceland. As new geothermal power stations are being built and with many more in the pipelines, the share of geothermal electricity in Iceland’s overall energy production is expected to grow substantially. Today, geothermal power plants in Iceland have a total capacity of 575 MW and generate approximately 4,500 GWh annually.

Hydro

It is the main source of electricity production in Iceland. Today, hydroelectric plants account for approximately three-quarters of all electricity generated and consumed in Iceland. The remaining quarter comes from geothermal power stations. The largest hydroelectric stations utilize the flow of Iceland’s glacial rivers, while numerous smaller hydropower plants are located in clear-water streams and rivers all around the country. All the major hydroelectric stations get their water from reservoirs, ensuring that these stations offer stable production year-round. In total, all the hydropower stations in Iceland have a capacity of just under 1,900 MW and generate around 12,600 GWh annually. Due to new hydropower projects the capacity and generation will increase substantially in the next few years.

Energy framework

It is the policy of the Government of Iceland to increase the utilization of the renewable energy resources further for the power intensive industry, direct use and transport sector in harmony with the environment. A broad consensus on conservation of valuable natural areas has been influenced by social opposition, increasing over the last decade, against large hydropower and some geothermal projects. There has as well been a governmental effort to search for geothermal resources in areas where geothermal energy has not yet been found. The Icelandic National Renewable Energy Action Plan (NREAP) was published in year 2012 in accordance with Directive 2009/28/EC which outlines the strategy for 2020 especially in terms of increasing the share of renewable energy in transport. Two major amendments were made in year 2012 to the energy legal framework in Iceland that effect geothermal exploration and utilization:Grants to new geothermal heat utilities were increased from being the equivalent of the accumulation of space heating subsidization with oil or electricity of 8 years to 12 years. In addition if the project receives other grants it will not effect in any way this lump sum payment (Act No. 78/2002).Promotion of the use of energy from renewable sources was further stipulated by changing law no. 30/2008 taking into consideration Directive 2009/28/EC. There is no need for special methods to ensure that renewable energy sources are used as the national production is 99% renewable both in electricity and space heating. Users have full access to all the renewable energy they need through the national grid or a local geothermal district heating plant. However there are renewable energy technologies such as heat pumps, increased insulation and energy efficiency methods promoted, mainly in areas which do not have access to geothermal heat and use renewable electricity for heating at a higher cost.

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Static Source:
  • Technology and Innovation Report 2011: Powering Development with Renewable Energy Technologies

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    Technology and Innovation Report 2011: Powering Development with Renewable Energy Technologies
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    This report focuses on the important role of renewable energy technologies in responding to the dual challenge of reducing energy poverty while mitigating climate change. The report identifies key capacity issues for developing countries and proposes concrete recommendations for the wider use of renewable energy technologies to promote sustainable development and poverty reduction.

  • Clean Energy Info Portal: reegle (Website)

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    This database provides global information on renewable energy, energy efficiency, and climate change, including country energy profiles, a list of key global stakeholders, policy and regulatory overviews, an energy and climate change glossary, a clean energy Web search, geobrowsing features, and a clean energy blog.

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    This reegle website provides comprehensive energy profiles for all countries with information from reliable sources such as UN or the World Bank. Profile information includes national policies on energy-related issues, visualized statistics, renewable energy potentials maps, national projects programmes, and key stakeholders.

  • Transport Research Knowledge Centre (Website)

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    The Transport Research Knowledge Centre (TRKC) provides an overview of transport research activities at the European and national level.

  • Greening Household Behaviour: The Role of Public Policy

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    This report evaluated the role of public policy in encouraging conservation in a residential setting. It interprets the results of an Organisation for Economic Co-operation and Development (OECD) survey sent to over 10,000 households within the OECD area on home water use, energy use, personal transport choices, organic food consumption, and waste generation and recycling. Analysis of the responses offers insight into the market, demographic, and policy factors that actually influence people’s environmental behaviour and consumption patterns.

  • Planning Geothermal Power Generation: Lessons Learned (Presentation)

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    This presentation reviews lessons learned from Kenya, the Philippines, Iceland, and other countries related to geothermal power. It includes key questions, barriers to development, and case studies. The presentation is a resource from the Energy Sector Management Assistance Program (ESMAP).

  • Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels

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    The Organisation for Economic Co-operation and Development (OECD) has undertaken its first-ever effort to inventory the fossil fuel related producer and consumer subsidies in 24 industrialized countries. The report finds that from 2005 to 2010 the overall value of more than 250 support measures in these countries was $45 billion USD to $75 billion USD per year. The report also finds that a significant portion of the support was in the form of tax policies and that nearly half of this amount went to supporting production or consumption of petroleum products.

  • REN21 Renewables 2012 Global Status Report: Europe

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    With a focus on Europe, this webinar—part of a series—presents the findings of REN21’s Renewables 2012 Global Status Report, which addresses the cumulating effect of steady growth in renewable energy markets, support policies and investment over the past years.

  • IRENA Portal for Studies on Renewable Energy Potential

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    This portal provides access to over 10,000 existing references of studies on renewable resources and potentials available worldwide. The information on this portal is presented using interactive flash maps with color codes that indicate the number of references available by country. Renewable energy resources considered include biomass, geothermal energy, hydropower, marine, solar and wind energy.

  • From Vision to Action: A Workshop Report on 100% Renewable Energies in European Regions

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    This report documents a parliamentary workshop held in October 2012 in Denmark that convened policymakers and experts to develop strategies to implement 100% renewable energy targets across Europe. The report presents the workshop findings, including the state of renewable energy technology as well as the policies and strategies necessary to implement and achieve 100% renewable targets. Each section includes a summary of policy and technology recommendations.