Iceland’s Ambassador Sturla Sigurjonsson says his country’s abundance of renewable energy undeniably gives it an advantage when it comes to reaching its goal of achieving carbon neutrality by 2040

There is an acute  awareness among Icelanders of the power of nature and the significant role it has played in shaping the nation through the centuries. This power has been incredibly obvious in the past two months with a volcanic eruption currently taking place only 30 minutes from the capital. Iceland is indeed a country of extreme geological contrasts; it is home to some of the largest glaciers in Europe as well as some of the world’s most active volcanoes.

The country has an abundance of clean, renewable energy thanks to its remarkable geography and geology that provides both hydro- and geothermal resources. All energy in Iceland is derived from renewable sources and energy production from renewable sources plays a fundamental role in the battle against the climate crisis. Iceland has in recent decades achieved remarkable success in energy transition in its district heating and electricity systems, where fossil fuels have been replaced by renewables. The country has now become a pioneer in the use of geothermal energy for space heating, with 90 per cent of Icelandic households heated with geothermal water and the remaining 10 per cent with electricity from renewable energy sources, allowing the population to enjoy improved energy security, lower energy prices and a cleaner environment.

This abundant renewable power and a favourable business environment have brought to Iceland investors who wish to limit the carbon footprint of energy intensive facilities such as aluminium smelters and data centres. In addition to Iceland’s natural advantage, Iceland has become a centre for innovation when it comes to green solutions. One such success story is Carbfix, an academic-industrial partnership that has developed a novel approach to capturing and storing CO2 by turning it into stone underground in less than two years. Huge quantities of carbon are naturally stored in rocks. Carbfix’s approach imitates and accelerates natural processes in which carbon dioxide is dissolved in water and interacts with reactive rock formations to form stable minerals.

Iceland also has potential to become a leading hydrogen producer and exporter in the world, with Landsvirkjun, the national power company of Iceland, having recently signed a declaration of intent regarding examining the potential for the export of green hydrogen from Iceland to Rotterdam. Hydrogen in Iceland would be produced through the electrolysis of water with renewable power. This could provide a greener alternative to the way most of the world’s hydrogen supply is produced, from natural gas, thereby leaving a carbon footprint.

Electric vehicle ownership is growing quickly and recently there have been large investments in charging infrastructure for electric cars, with charging stations now available all around the ring-road. Recently, Iceland made a remarkable milestone when renewable energy consumption in transport officially reached over 10 per cent of total energy consumption in this area. In fact, Iceland has the second-highest number of new electric and hybrid electric car registrations in the world. The energy transition is well under way in transport on land, but other areas, such as transport on sea and in the air, are in the initial stages. The objective is that all ships, boats, and other seagoing vessels, whether for fishing or for transport of cargo, shall be powered by energy from renewable sources. The same goes for air transport, as quickly as technology and feasibility will permit.

An abundance of renewable energy undeniably gives Iceland an advantage when it comes to reaching its goal of achieving carbon neutrality by 2040. The Icelandic government recently introduced an action plan on how to implement its Energy Policy to the year 2050, outlining a clear vision of a sustainable energy future. Leading up to COP26, the Icelandic government will continue to focus on renewables, electrification of mobility, hydrogen and e-fuels, and carbon capture and removal. Ahead of COP26, it is vital that all countries focus on a green transition from fossil-based economy to clean power and green solutions.