Iceland’s Green Energy

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Written for Coursera (MOOC) Class ‘Global Sustainable Energy, Past, Present and Future ‘ by University of Florida (June 2013).

Iceland is unique and interesting place for many reasons, cultural, geological and economically.

  • Generates 100% of its electricity from renewable sources
  • Highest electricity consumption per capita in the world, more than double Norway’s, 2nd highest.
  • Many active volcanoes: Eruption of ‘Eyjafjallajökull’ in April 2010 – airspace closure Europe
  • Capital city Reykjavik: World’s most northerly capital, pop 120,000 (37.5% Iceland total pop)

(CIA Factbook)

Traditionally, Iceland’s main industry has been fishing and more recently Aluminium production.

The clip from the film ‘Dreamland’ highlights some of the opposing views that are currently being debated in the country.  Aluminium smelting and Hydroelectricity, also Environmental Protection and Geothermal Energy are hot topics.

Video Link: ‘Dreamland

Hydro-Electric Power

The geography and climate of Iceland lends itself to hydroelectricity production on a large enough scale to meet the majority of the country’s power needs.  Hydro accounts for 12,500 GWh annually, 73% of total electricity generation.

(Statistics Iceland)

Geothermal Energy

A consequence of Iceland’s geological activity is that it is able to harness heat from below the earth to generate electricity and heat houses.  It is used to produce the remaining 30% of electricity generation, annually 4,700 GWh.  In addition to this, a further 11, 700 GWh are produced as heat for residential space heating, as well as warming greenhouses and swimming pools, etc.


Total Energy Mix 

The table below shows the national energy mix for Iceland in 2010/11.

Elect Oil Heating
Total 16,290 7,245 7,028
Aluminium 12,341 0 0
Other Industry 1,527 256 222
Residential 863 0 5,694
Transport 0 5,106 0
Agriculture 220 0 194
Fishing 42 1,849 486
Services 1019 0   0
Utilities 700 0 431
Other 0 47   0

The Aluminium industry in Iceland began in 1969 when the smelter at Straumsvík opened.  A further two Aluminium plants were opened in 1998 and 2008.  As can be seen from the graph below, Aluminium production is by far the largest consumer of electricity and total energy in the country.

Aluminium smelting requires vast electricity input, and Iceland’s potential for hydro-generation provided a good economic match.

If Aluminium industry consumption is discarded, the Electricity per capita falls to 12,500 kWh annually, which is marginally above that of the USA.



Figure 1: Energy Consumption by Sector Giga Watt-Hours

As can be seen from Figure 1, Iceland still relies heavily on imported petroleum for most of it’s transportation mainly for automobile and air travel.  The Icelandic fishing industry is also a major oil consumer, required to power the fishing fleet.

There are some hydrogen filling stations already in Reykjavik, which indicates that the country is working towards 100% clean indigenous energy.


Figure 2: Energy Consumption as Percentage of Total

As seen in Figure 2, Industry currently uses nearly half of all the energy consumed in Iceland.  The government estimates that there are over 20,000 GWh as yet untapped geothermal generating capacity.  Since the population growth rate has hovered around 1% since 1960, and is currently 0.3% (World Bank Data), it seems likely that when this additional energy is exploited, it will be used in industry, therefore increasing the fraction of total energy consumed by the sector.


Figure 3: Electricity Consumption Per Capita (annual kWh) (

The figure for Icelandic electricity consumption per capita, see Figure 3, seems astonishing when compared to the other nations in the top ten.  However, the fact that this quantity of energy consumption is 100% renewable, all the more remarkable, is a success story from which other nations can benefit.

Iceland is interested in exporting this energy in some form, they are investigating an interconnector cable to the UK and possibly mainland Europe.  They are also trying to attract energy hungry business to their shores.

They are world leaders in Geothermal Energy, which has great potential across the globe as a source of clean renewable energy.  Oil drilling technology can be adapted to reach into the hot sedimentary rocks, which heat pumped water, which emerges as steam to power turbines and generate electricity.

Geothermal Energy Diagram

Figure 4: Geothermal Electricity Diagram

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