Iceland already gets 99.96% of its electricity from low-carbon sources—an outstanding achievement. Over the last 12 months, from August 2025 to July 2026, hydropower supplied about 73% of electricity and geothermal supplied about 26%, leaving fossil electricity close to zero. The next challenge is to extend this clean-electricity success to transport, heating and industry: further electrification will require much more electricity, even with an almost entirely low-carbon supply.

Is Electricity Growing in Iceland?

On a per-person basis, Iceland’s electricity consumption remains well below its historic peak, rather than setting new growth records. The latest 2026 figure is about 46,100 kWh per person, compared with a record of about 56,800 kWh in 2015—a decline of roughly 10,700 kWh, or 19%. Low-carbon electricity generation follows almost exactly the same pattern: about 46,100 kWh per person today versus about 56,800 kWh in 2015, also around 19% lower. This shortfall is concerning given future electricity needs, although these figures alone do not establish whether total national electricity consumption is currently growing.

Suggestions

Iceland can increase clean electricity generation by expanding geothermal production, upgrading existing hydropower facilities and strengthening its electricity grid to connect additional supply with growing demand. Solar power could add a complementary source of low-carbon electricity, particularly during the long summer days. Iceland should also assess nuclear power as a potential source of dependable clean electricity for future industrial demand and electrification. A coordinated expansion of generation and grid capacity would help replace fossil fuels in other sectors, reducing climate-changing emissions and air pollution.

History

Iceland’s low-carbon electricity history shows substantial expansion, particularly during the 2000s. Hydropower generation rose by 0.5 TWh in 1973, followed by three annual increases of 0.4 TWh in the late 1990s; geothermal added another 0.5 TWh in 1999. Between 2006 and 2009, the listed increases totalled 5.1 TWh for hydropower and 2.9 TWh for geothermal, with an exceptional 4 TWh hydropower increase in 2008. Further gains followed during the 2010s: geothermal added 0.5 TWh in 2012 and 0.8 TWh in 2018, while hydropower increased in 2013, 2015 and 2017. More recently, hydropower fell by 0.5 TWh in 2020 before rebounding by 0.8 TWh in 2021, then declined by 0.6 TWh in 2024; geothermal fell by 0.5 TWh in 2025. These recent setbacks underline the importance of returning to sustained growth in clean electricity generation.

Electricity Imports and Exports

Balance of Trade

* 12M = Last 12 months (Aug 2025 – Jul 2026) — a rolling 12-month period, not a calendar year.