Iceland stands as a beacon of low-carbon electricity generation, drawing an impressive 99.98% of its power from clean sources. This significant achievement is primarily supported by hydropower, contributing more than two-thirds of the total electricity supply from the turquoise waters flowing through the nation's rivers and waterfalls. The remaining close to a third comes from geothermal energy, harnessing the Earth's heat beneath Iceland's volcanic landscape. With a near-total reliance on these sustainable sources, Iceland has taken commendable strides in departing from fossil energy. However, as more sectors like transport, heating, and industry are set to be electrified, meeting these expanding demands will require a considerable increase in electricity production.
Data sources used on this page include EIA, Eurostat, IEA and World Bank. More about data sources →
Is Electricity Growing in Iceland?
Despite its achievements in clean energy, Iceland has seen a downward trend in electricity consumption per person over recent years. As of 2025, electricity consumption stood at around 46,963 kWh per person, marking a significant reduction of nearly 9,845 kWh from the peak consumption level recorded in 2015. This decline is mirrored in the generation of low-carbon electricity, which saw a decrease of 9,842 kWh per person from the all-time high set the same year. These numbers indicate that, while Iceland remains a leader in clean energy, there is a pressing need to boost generation capacity to cater to future demands for electrification across various sectors.
Suggestions
To ramp up its low-carbon electricity generation, Iceland can look towards innovative solutions such as expanding geothermal energy capture and possibly investing in solar energy technologies despite its northern latitude. Furthermore, establishing collaborations to integrate advanced nuclear energy systems could prove beneficial. Small modular reactors, in particular, represent a promising technology capable of delivering reliable, low-carbon electricity with minimal environmental impact. Harnessing these strategies can enable Iceland not only to meet its electricity demands but also to continue its global leadership in low-carbon energy.
History
Tracing the history of Iceland's journey in low-carbon electricity reveals years of strategic advancements. The pivotal growth began in the late 20th century, with notable increments in hydropower capacity seen in 1973 and through the late 1990s. The late 2000s marked another surge, where geothermal and hydropower reached unprecedented increases, notably in 2008, reinforcing the island’s energy grid. The early 2010s sustained this momentum, punctuated by enhanced geothermal capture, until a minor dip in hydropower occurred in 2020 and again more recently in 2024. While fluctuations occur, the overarching trajectory affirms Iceland's steadfast commitment to clean electricity, setting a powerful example for the adoption of green energy resources worldwide.
