Electricity in Iceland in 2022

Iceland is truly a global leader in the use of clean and green energy, sourcing essentially all (99.99%) of its electricity from low-carbon energy sources in 2022. Breaking it down, hydropower is the dominant energy type, providing a significant aspect of about 71 percent. Geothermal power also has a sizeable contribution to this mix at roughly 29 percent. Furthermore, Iceland is doing its part in advancing global sustainability efforts, being a major net exporter of electricity that allows neighboring regions to reduce their own carbon emissions. However, the country still faces the challenge of fully electrifying other sectors such as transportation, heating, and industry, which will inevitably demand a higher supply of electricity.

Suggestions

To increase its low-carbon electricity generation, Iceland could consider amplifying the capacity of its existing hydropower and geothermal plants or constructing new ones. The country's remarkable geothermal resources, in particular, could be further tapped. Furthermore, despite being rich in low-carbon energy resources, technological advancements could enable Iceland to test and possibly integrate other sustainable solutions into its energy portfolio, like solar, wind, or nuclear energy. However, the successful implementation of such strategies would require well-informed planning and a strong commitment to maintaining the environmental integrity of Iceland's unique and delicate ecosystems.

History

From a historical perspective, a significant increase in low-carbon electricity production in Iceland was traditionally driven by advances in hydropower since the early 70s. Initial increments in hydropower generation were modest, mostly in the range of 0.3-0.5 TWh annually. However, the biggest leap in hydroelectric generation occurred in 2008 with an addition of 4 TWh. Turn of the century also marked a shift towards geothermal energy, with 2006 standing out as a landmark year when close to 2 TWh of electricity came from this source. Nevertheless, there were periods when hydropower generation dipped slightly, most noticeably in 2016, 2019, and 2020, reflecting the inherent variability of hydropower. Despite these fluctuations, as reflected in 2021 data, the country has made steady overall progress in increasing its low-carbon electricity generation.

Electricity Imports and Exports

Balance of Trade

Data Sources