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The Republic of Iceland: Ambitious Energy Plans

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The Nordic Dimension of Energy Security

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Abstract

Iceland is a leading example of the energy transformation. It has extensive positive experience with such transformations, as the transition from oil to geothermal heating is a good illustration of a very successful national energy transformation with a strong positive economic impact and environmental benefits.

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Notes

  1. 1.

    In 2014, about 85% of primary energy consumption in this island state came from indigenous renewable resources, 66% of which came from geothermal energy.

  2. 2.

    On the basis of http://www.imd.org/uupload/imd.website/wcc/scoreboard.pdf. It should also be explained that the IMD World Competitiveness Scoreboard presents the 2018 overall rankings for the 63 economies covered by the WCY. The remaining places in the top 10 are occupied largely by Nordic countries: Denmark, Norway and Sweden rank 6th, 8th and 9th respectively. Finland occupies the 16th spot. https://www.imd.org/wcc/world-competitiveness-center-rankings/world-competitiveness-ranking-2018/

  3. 3.

    Geothermal energy is the energy of geothermal waters extracted from the earth’s surface.

  4. 4.

    Gigawatt hour (GWh) = 1000 KWh (Kilowatt hours).

  5. 5.

    For example, a combined heat and power plant operating in Keflavik with high-pressure water at 260 degrees Celsius.

  6. 6.

    Compare Kotowski and Fechner n.d.

  7. 7.

    The energy consumption indicator includes domestic sales and purchases for foreign ships and aviation. See http://www.nationmaster.com/country-info/profiles/Iceland/Energy

  8. 8.

    The functioning of geothermal heating systems explains Ingolfsson n.d. See also Walat 2007.

  9. 9.

    The first hydroelectric power station was built in Hafnarfjördur in 1904.

  10. 10.

    In 2010, they provided almost 27% of the national electricity production.

  11. 11.

    For more on the subject, see Geothermal resources.

  12. 12.

    In 2013, the total geothermal energy use was 46.7 PJ, of which 45% was space heating.

  13. 13.

    The conversion dated to February 10, 2019.

  14. 14.

    Lower heating costs have contributed to an overall improvement in the standard of living; even the poorest residents of the capital city can live in warmer houses in winter. Since the 1930s, houses in Reykjavik have been heated to make society healthier: between 1937 and 1948, the incidence of flu and cold fell from 22% to 4%. Data after Chrońmy Klimat 2017.

  15. 15.

    It is a supercritical steam heated to about 500 °C, in which the difference between the liquid and the gas phase disappears.

  16. 16.

    A power generating installation connected to such a well will be sufficient to supply 30–40 thousand Icelandic apartments with energy. The power plant is to be ready soon. See The Master Plan for Nature Protection and Energy Utilization.

  17. 17.

    For example, the capital city of Reykjavik has commissioned a 400 MW geothermal power plant in Nesjavellir.

  18. 18.

    Electricity consumption shows that the aluminum industry in Iceland used up to 70% of its electricity production in 2013.

  19. 19.

    A diatomaceous rock for the production of filters.

  20. 20.

    The American concern Alcoa INC.

  21. 21.

    PCC BakkiSilicon hf was the investor; https://www.pcc.eu/projekt-islandia/?lang=pl

  22. 22.

    The problem is that the growing Icelandic aquaculture sector has recently become the focus of media attention because of concerns about its environmental impact. As a result, the operating licenses for open sea cage salmon farms in Patreksfjörður and Tálknafjörður were withdrawn in October 2018 due to environmental shortcomings. Following their withdrawal, the Parliament adopted a law granting the Minister for Fisheries the power to issue temporary fish farming concessions. The temporary licenses were granted to the Arctic Fish and Arnarlax farms and are valid for a total of 4000 tons of salmon, which makes only a small part of the previous 17,500 tons. The license requires companies to be active in addressing the environmental shortcomings that led to the withdrawal of their concessions. https://icelandnews.is/wiadomosci/z-kraju/tymczasowe-koncesje-na-dzialalnosc-dla-farm-lososi

  23. 23.

    It is worth noting that in 2017 the export of sea products fell by more than 15%. The value of sea products for export in 2017 amounted to ISK 197 billion (USD 1.8 billion / EUR 1.6 billion), which constitutes a decrease by 15.2% compared to the previous year. In the period of 12 months – from August 2017 to July 2018 – the total catch amounted to 1.286 million tons, which is an 11% decrease compared to the previous 12 months. Data after https://icelandnews.is/wiadomosci/gospodarka/zmniejszyl-sie-eksport-ryb-z-islandii

  24. 24.

    90% of swimming pools are heated by geothermal sources, 8% by electricity and 2% by oil and waste incineration.

  25. 25.

    Most systems have the ability to mix return water with hot water (80 °C).

  26. 26.

    The total area of greenhouses has decreased despite an increase in total production. This is due to the increased use of artificial lighting and CO2 in the greenhouse sector.

  27. 27.

    The interconnection will allow Iceland to export surplus energy in a renewable water system which is not currently used due to economic and operational constraints.

  28. 28.

    Data after https://www.landsvirkjun.com/researchdevelopment/research/submarinecabletoeurope/

  29. 29.

    See also some interesting projects concerning the North Atlantic Energy Network with the participation of Iceland, worked on jointly by Orkustofnun (OS) – National Energy Authority of Iceland Norges Arktiske Universitet (UiT) – The Arctic University of Norway Energy Styrelsen – Danish Energy Agency Jarðfeingi – Faroese Earth and Energy Directorate Shetland Islands Council – Economic Development Service Greenland Innovation Centre, https://orkustofnun.is/gogn/Skyrslur/OS-2016/North-Atlantic-Energy-Network-Report.pdf

  30. 30.

    Regulation on the collection of data on the production, import, storage and sale of fuels and on the monitoring of the share of renewable fuels in total sales of land transport fuels, No 870/2013.

  31. 31.

    There are about 180,000 cars on Iceland’s roads. The fishing fleet is made up of 2500 trawlers – fishing accounts for two thirds of Iceland’s export earnings. See Prognoza zużycia paliwa.

  32. 32.

    Exploration and production licenses are exclusive and granted in licensing rounds in accordance with the Hydrocarbon Resources Act. See https://orkustofnun.is/gogn/os-onnur-rit/OS-Iceland-Offshore-Exploration-2015-Feb.pdf

  33. 33.

    The northern part of the Dreki area refers to an ocean area in the Icelandic exclusive economic zone lying east of 11.5° W and north of 67° N and is demarcated to the east and north by Iceland’s 200-mile exclusive economic zone.

  34. 34.

    CNOOC has 60%, Petoro – 25%. Taking into account the available data on the geology of the area and other factors, such as survey costs, these two companies decided to resign from their share of the license. As a result, they have waived their rights to petroleum concessions in the area, as well as their obligations to continue exploration and development. January 23, 2018, https://icelandnews.is/wiadomosci/gospodarka/wstrzymano-poszukiwania-ropy-naftowej-na-wodach-islandzkich

  35. 35.

    Eykon Energy ehf is a subsidiary of Eykon AS in Norway which holds a 15%-interest in 1/3 of the Icelandic license.

  36. 36.

    See Legal and Regulatory Framework on Fuels and Energy Transition.

  37. 37.

    Prof. B. Arnasson, a chemist from the University of Reykjavik, estimates that the transition to clean, eco-friendly propulsion systems will take about 30–40 years. See PAP 2007.

  38. 38.

    In industrial applications (e.g. for indicating the amount of energy produced annually by power plants), larger units are used: megawatt hour (MWh), gigawatt hour (GWh) and terawatt hour (TWh). 1 TWh = 1000 GWh, 1 GWh = 1000 MWh and 1 MWh = 1000 kWh.

  39. 39.

    It is also worth noting that in 2007 Althing made a globally innovative decision to abandon all fossil fuels. According to this plan, hydrogen is to be the main source of energy in 30–40 years.

  40. 40.

    Landsvirkjuan Annual Report 2011, Annual Report 2017, National Power Company of Iceland (Icelandic: Landsvirkjuan), https://annualreport2017.landsvirkjun.com/

  41. 41.

    The study by Maskína concerns an ongoing public debate on whether Iceland should adopt the so-called third energy package as part of its membership of the European Economic Area (EEA), May 19, 2018. See https://icelandnews.is/wiadomosci/gospodarka/islandczycy-nie-chca-przekazac-wladzy-nad-swoim-sektorem-energetycznym-europejskim-instytucjom

  42. 42.

    Parliamentary resolution on an action plan on energy transition, No. 18/146, 146. löggjafarþing 2016–2017. No. 18/146. Þingskjal 1002 — 146. mál., https://www.althingi.is/altext/146/s/1002.html

  43. 43.

    The aim of the energy transformation is to increase the share of renewable energy in land transport from 6% in 2016 to 10% by 2020 and to 40% by 2030. An additional target is to increase the share of renewable energy in the fisheries sector from 0.1% in 2016 to 10% by 2030. https://nea.is/fuels/energy-transition/

  44. 44.

    Regulation on the collection of data and transmission of information by government agencies in connection with the accounting of Iceland on the release of greenhouse gases and the uptake of carbon dioxide from the atmosphere, No. 520/2017 and Regulation pursuant to Act No. 70/2012 on Climate.

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  1. Katedra Krajów Europy Północnej, Uniwersytet Jana Kochanowskiego, Kielce, Poland

    Ryszard M. Czarny

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Czarny, R.M. (2020). The Republic of Iceland: Ambitious Energy Plans. In: The Nordic Dimension of Energy Security. Springer, Cham. https://doi.org/10.1007/978-3-030-37043-5_8

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