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Landsvirkjun is intent on becoming a leader in the sustainable use of renewable energy sources and resolute in pursuing and supporting innovation and technological development within the field. In order to achieve this, extensive research is conducted in a diverse variety of disciplines, including research on ecosystems, meteorology, hydrology, glaciers and geology, to name but a few. The impact of power projects on ecosystems, water systems and various other factors are monitored, as well as the effectiveness of mitigation measures. A number of different parties, universities, research institutes, companies, individuals and scientists, both national and international, conduct this research.

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Connecting with Europe

Landsvirkjun has been involved in assessing the feasibility of a sub-sea cable connection with the European electricity grid for some time. Preliminary assessments, carried out up until the turn of the last century, suggested that a sub-sea cable was technically possible but not economically feasible. However, changing conditions in the European energy market indicate that a sub-sea connection with Europe could in fact prove to be a lucrative project.

Connecting the Icelandic electricity grid to the European grid would have a substantial effect on Icelandic society and the Icelandic economy. It would therefore be crucial to assess both the negative and positive impact of such a project before moving forward. The prerequisites for a project of this scale would be the achievement of a broad consensus within society and effective cooperation with stakeholders.

In light of this, the Icelandic Ministry of Industries and Innovation appointed a 15 member, cross- party committee to assess the macroeconomic and social implications of a sub-sea cable and they returned their verdict to the Minister in June, 2013. The report was put forward for debate within the Icelandic parliament and then referred to the Industrial Affairs Committee of the Icelandic parliament. The committee returned its findings in February, 2014, recommending the further development of the project. They also stated the importance of raising public awareness and a broad perspective on the potential impact of the project.

Competitiveness of the project

The changing landscape of the energy market and technological advancement are perhaps the strongest indicators that power exchange via a sub-sea cable could prove to be competitive within the international market. Sub-sea cable projects are becoming increasingly large-scale as new technology allows for longer and more powerful connectors, at greater depths, across difficult sea terrain.

The increasing demand for ‘fossil fuel based energy’ has resulted in historically high energy prices worldwide. Electricity prices are no exception as over half of the world’s electricity is produced by utilising coal and natural gas. There is also increased awareness on the negative environmental impact of burning fossil fuels.

The International Energy Agency predicts that the demand for energy in 2035 will be 73% higher than what it was at the beginning of the century.

In light of this, Europe has developed a support mechanism to ensure the long-term profitability of renewable electricity generation and the reduction of GHG emissions. It is entirely possible that Icelandic electricity, generated via sub-sea cable, would be eligible for such support.

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The Department of Energy & Climate Change in the UK guarantees electricity prices for 15-35 years to energy producers

Source Department of Energy & Climate Change, November 2013

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Economic and societal effects

The latest assessments indicate that electricity sales via a sub-sea cable could prove to be profitable for Icelandic energy producers and competitive in price for electricity purchasers in the rest of Europe. However, the profitability of such a project would be dependent on bilateral agreements, addressing not only energy prices but the responsibility taken on by both parties with regard to the potential risk factors involved. Landsvirkjun has been purposefully involved in an informed discussion of the underlying risk factors involved, and this work will continue.

The large scale of the project would demand the broad consensus of Icelandic society for it to proceed. Further research would be required on the macroeconomic, societal and environmental impact of the project and an open and informed discussion, within Iceland, on the relevant factors would be necessary. Work has been ongoing on these issues, including the assessment carried out by the cross-party advisory committee appointed by the Icelandic Ministry of Industries and Innovation and an analysis conducted by Gamma (GAM Management) on the potential effects of the cable on Icelandic households.

Where would the energy come from?

A sub-sea cable supplied by hydropower in Iceland would offer the possibility of exporting and importing energy. Renewable energy within Europe is mostly reliant on intermittent energy sources such as wind and solar power. However, the demand for energy fluctuates on an hourly and seasonal basis and Europe needs to guarantee more reliable sources of electricity supply, in order to compensate for the unavoidable intermittency of solar and wind power.

A sub-sea cable would give Icelanders the opportunity to better utilise the country’s energy resources and would increase the revenue created by these resources for the national economy.

The Icelandic grid can offer this reliability and a sub-sea cable would mean that Iceland could dispatch electricity, via the cable, according to need. The sub-sea cable would enable Iceland to better utilise the value of dispatchable, renewable energy.

The export of electricity would allow for the more efficient utilisation of resources in Iceland and generating more electricity, via currently operational hydropower stations. The inflow rate to the hydropower reservoirs in Iceland is variable between years but is, on average, higher than the amount required to fulfil current energy contracts. In isolated electricity systems, excess water flows in spillways could be used, in part, if the system were connected with larger markets.  Moreover, Icelandic consumers do not always fully utilise available energy resources and energy is therefore often wasted within the closed national grid. Connecting to a larger grid would mean more effective utilisation. In dry years or in the case of unforeseen circumstances, Iceland could reduce the energy export level and even import energy temporarily.

The exported electricity would be partly supplied by new power projects from already utilised areas and new areas. The prospect of new projects in hydropower, geothermal and wind energy would be reliant on the framework set out by the government on energy utilisation, including the Master Plan for Hydro and Geothermal Energy Resources in Iceland.

Preliminary assessments on investment costs and the length of the construction period show that the shortest distance possible would be the most economical option, under present conditions. The shortest distance for a sub-sea cable between Iceland and the UK would be approx. 1000km and appropriate locations at either end are presently being assessed, as well as different cable routes.

Potential connection areas in Iceland, for the sub-sea cable, are being considered as well as a number of other factors, including sea depth, sea terrain, wave height, fisheries and sailing routes. The project would also require necessary reinforcements of the electricity grid. The UK has focused on the issue of accessing the UK national grid. The next step involves further research on the feasibility of different landing locations, the impact on other industries such as fisheries and oil production, and of course the impact on the environment.

Statnett and National Grid, the owners and operators of the national grids in Norway and the UK, are developing a 1, 400 MW, 700 km sub-sea cable connecting the two countries.

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Wind power in the future

To the north of Búrfell, is a lava field by the name of Hafið. Landsvirkjun has erected two 900 kW wind turbines in the area, for research purposes. The wind turbines have been successfully operated since the end of January, 2013 and there are clear indications that Iceland is an advantageous location for electricity generation, utilising wind power.

The yearly average capacity factor for Hafið is approx. 40% which is unusually high. In comparison, the average capacity factor worldwide is approx. 28%. Landsvirkjun’s wind turbines are relatively small (approx. 55 metres hub height), and this makes the high capacity factor even more remarkable. This is explained by the fact that wind velocity is relatively high, at a relatively low height in Iceland due to low surface roughness. This significantly reduces the cost of energy as hub heights can be kept quite low.

The wind turbines at Hafið have so far generated 5,900 MWh in the eleven months they have been in operation which is higher than the annual 5,400MWh initially predicted.

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Wind turbine capacity in 2013

After nearly one year of operation, the average capacity factor for the wind turbines is approx. 40%, which exceeds all expectations. In comparison, the average capacity factor worldwide is approx. 28%.

*from the 21st of January.

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The third pillar in the power system

Landsvirkjun has made the decision to conduct further research on the wind power capacity at Hafið, via extensive wind velocity and scenario studies. Proposals for the size and location of potential wind farm sites will also be analysed. The project is innovative as the potential of wind power has not been researched in Iceland before. Research areas will include the impact of the project on the environment, on society, the feasibility of development and operations and opportunities in utilising the interaction of wind power and hydropower. The legal framework and regulations will need to be reviewed as well as an analysis of the advantages of utilising wind farms for the electrical grid. An agreement has been reached with the engineering companies Efla and Mannvit who will provide consultation on the project. The project will be ongoing for the next two years.

The objective of the project is to ensure that Landsvirkjun has enough supportive evidence in the form of advanced analyses and data, to make an informed decision with regard to potential wind farms.  Further research and preparation supports effective procedures in the development of wind power as the third pillar in the electrical system.

In Iceland, wind velocity is generally at its highest during the winter period when there is minimum water flow to Landsvirkjun’s storage reservoirs.  In addition, hydropower backed by storage is ideal for load balancing. Consequently, the possible synergy of wind- and hydropower electricity generation is high.

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Environmental Research

Environmental research is a crucial part of Landsvirkjun’s operations. Research provides insight into the decades ahead and monitors a variety of environmental and societal factors affected by the Company’s operations. Research provides baseline information as well as supplying crucial information on future scenarios which could prove important in the development and design of specific power projects.

Landsvirkjun works in accordance with a certified environmental management system. A detailed discussion of environmental monitoring and the Company Policy on environmental matters can be found in Landsvirkjun’s Environmental Report.

Research, monitoring and mitigation measures

Extensive information on the natural environment and society are important in the development of potential power projects. Research is essential in acquiring new knowledge in the many areas possibly affected by the Company’s operations. Research is conducted on ecosystems, geology, archaeology, geography, tourism and many other areas.

Once the decision has been made to utilise a resource, research monitoring begins. Initially the focus is on mitigation measures, executed for the purpose of minimising the environmental impact of development. Once the construction period reaches completion and operations begin, then research monitoring focuses on the impact of particular environmental aspects and the success rate of mitigation measures.

Environmental Monitoring

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  • 1 Glacier monitoring

    Landsvirkjun operates an extensive research and monitoring program for glaciers which provide runoff to the Company’s hydropower plants. The programme is run in cooperation with the Institute of Earth Sciences at the University of Iceland and the Icelandic Meteorological Office. The mass balance of the glaciers is measured on an annual basis, in order to assess surface accumulation and surface ablation. The results show that the glaciers, providing the water resources for Landsvirkjun, have in fact diminished in the last two decades and this is believed to be a direct result of climate change. The increase in glacial melt results in increased runoff to hydro power stations and therefore creates opportunities for increased and improved energy generation. Landsvirkjun is already accounting for ‘climate change impact’ in the development and design of potential power projects.

  • 2 Hydrology

    Extensive knowledge on water flow characteristics is the key to better utilisation of the water resource. Landsvirkjun monitors all factors pertaining to the water cycle, from the moment a water drop hits the earth as precipitation, until it is returned to the sea to begin the cycle again. Analyses show the fluctuations in water flow and the factors influencing these changes. The water flow in rivers increases with high precipitation and long warm summers increase glacial melt.

  • 3 Reservoir monitoring

    Landsvirkjun’s energy reserve is stored in the storage reservoirs of the Company and water surface levels are measured continually. The results are the basis for the management of the water resource and the storage reservoirs, the transfer of energy between different parts of the country and the implementation of contingency plans in the case of unusual water surface level changes. Other monitoring measures are commonplace in Landsvirkjun’s reservoirs, including the erosion of reservoir banks and reservoir shoreline evolution. Bathymetric measurements are conducted in order to monitor the levels of sediment and glacial till deposited in the reservoirs by the glacial rivers and the corresponding changes in reservoir volumes.

  • 4 Dam monitoring

    All of Landsvirkjun’s dams are closely monitored. The condition, movement and any leakage in the bedrock (in close proximity) is monitored. The ground water pressure in the actual dams, in the bedrock underneath them and the groundwater level in the proximity of the dams is monitored. These data are collected annually and the overall status of the dams is assessed. If results from the Sigalda Dam are assessed then it is clear that the leakage below the dam has decreased by 70% since operations began. This is due to extensive manmade sealing measures and natural sealing created by the sediment from the Tungnaá River.

  • 5 Discharge

    Extensive knowledge with regard to the discharge below the hydropower stations is essential as the discharge from the stations affects both humans and wildlife, in and around the rivers. Landsvirkjun has carried out thorough research on the discharge beneath Írafoss in the Sogið area in order to secure salmon migration in the river.

  • 6 Meteorology

    Meteorology has a significant impact on the water flow within the water resources utilised by Landsvirkjun, for energy generation. Landsvirkjun owns and operates numerous weather monitoring stations in the highland areas. They monitor air temperature, air pressure, wind speed, precipitation and sunlight. The results are submitted to the national meteorological database and to the Icelandic Meteorological Office, where they are further utilised for meteorological forecasts and as real time information on weather conditions. The results are therefore not only used by Landsvirkjun but also by the entire country.

  • 7 Groundwater monitoring

    Groundwater is closely monitored by Landsvirkjun at all of their power stations. The development of groundwater within geothermal areas is particularly significant and can indicate the need for mitigating action, in the case of utilisation affecting the groundwater. Results from the monitoring systems in the Mývatn area have so far shown that geothermal utilisation at Bjarnaflag has not affected the groundwater flow and water quality in Lake Mývatn.

  • 8 Seismic Activity and land mass changes

    Landsvirkjun monitors activity in geothermal areas by using a powerful network of seismic sensors and GPS monitoring systems. This enables the Company to recognise the layout of fractures in the subsurface, elevation changes, tectonic activity and volcanic activity. This information is also crucial in supporting successful borehole drilling in the area. The fact that subsidence in the Krafla area has been measured at 10cm, over the course of two decades, is a clear example of the value of such information.

  • 9 Emissions

    Emission records for the geothermal stations are kept and published, Landsvirkjun has also set up three hydrogen sulphide monitoring stations in Reykjahlíð, the results of which can be accessed in real time via the Landsvirkjun website.

  • 10 Geothermal well monitoring

    Geothermal wells are monitored regularly at Landsvirkjun’s geothermal stations. Well temperature logs, pressure logs and the chemical composition of geothermal fluid are analysed as these provide information on the energy content and quality of the geothermal reservoir. Amongst other things, these observations have shown changes in the steam composition from the Krafla Geothermal Station, since the end of the Krafla Fires in 1984, where the level of carbon dioxide in the steam has decreased substantially.

  • 11 Noise levels

    The noise from geothermal areas can be decreased by using the correct type of mufflers for boreholes. Landsvirkjun closely monitors the noise levels, within the geothermal areas utilised by the Company in the northeast of Iceland, in order to assess the need for increased noise reduction measures and to monitor those already in place. Landsvirkjun is committed to keeping noise levels in areas close to popular tourist spots at the maximum noise level recommended for inhabited areas, that is 50db (A). The maximum noise level for energy production areas is 70dB (A).

  • 12 Reindeer

    The distribution and number of reindeer in the east of Iceland, in the Snæfellsöræfi wilderness, is monitored: in Brúaröræfi, Vesturöræfi, Fellum, in Múli and Hraun. Reindeer numbers are estimated via basic counting measures and aerial photographs of the area. The EIA conducted for the Kárahnjúkar Hydropower Station predicted changes to the distribution and number of animals. However, the affects were measurably less than initially predicted. Ongoing monitoring will show the long-term effects of the power project on the reindeer population.

  • 13 Birdlife

    Landsvirkjun’s operations can have a diverse effect on birdlife. The construction of reservoirs and changes to the course of the river channel can affect their habitat. New roads, transmission lines, wind turbines and other manmade structures can also disturb the population. Research has shown, amongst other things, that the Hálslón Reservoir did not cause a decrease in the Pink- footed Goose population in the area, despite a reduction in grazing land. However, the decrease in the Long- tailed Duck could be attributed to increased turbidity in the river and water in the Hálslón Reservoir. Landsvirkjun is involved in monitoring birdlife in all current and new areas of operation, in order to better understand the effects on birdlife.

  • 14 Freshwater ecology

    Hydropower stations can have a significant impact on fish and other river biota. Landsvirkjun closely monitors river biota in all areas of operation in order to implement timely mitigation measures in the case of any measurable changes. Monitoring the fish population is mainly threefold: the analysis of fishing data to acquire information on changes to the fish stock, net fishing data to acquire information on the condition, diet, maturity and size distribution of fish and finally juvenile counts to acquire information on the density and recruitment of juveniles. Results in the Þjórsá area have shown that the construction of the power station and the resulting changes to water flow have improved conditions for the salmon population, thus supporting its growth.
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Research and monitoring projects in 2013:

  • A review of the vegetation map for the area affected by the Fljótsdalur Hydropower Station was completed.  The vegetation map was utilised for various purposes, including research on reindeer routes, grazing and habitat within the area. The area originally covered by the vegetation map was extended and is now over three thousand kilometres in size. The project was completed in cooperation with the Icelandic Institute of Natural History. Other projects now underway in the area affected by the Fljótsdalur Hydropower Station include fish research in the water catchment area of Lagarfljót and Jökulsá in Dal.

  • The warm groundwater stream at Mývatn was researched in connection with the impact of utilising the geothermal resources in the Bjarnarflag area. Air quality monitoring was increased in the Mývatn area and the results for three of the stations were published on the Landsvirkjun website. The EIA report on the Bjarnarflag Station, now ten years old, was reviewed in order to assess the need for a partial or total re-assessment of the report.

  • Work was ongoing on projects pertaining to the visual impact of geothermal stations, including issues of design and landscape integration. The objective is to focus more on the surrounding landscape of sites in the structural design process and to seek out new landscaping measures, designed to minimise the negative impact of unavoidable disturbances to land, in the power project preparation process. This year, procedures and guidelines for landscaping measures and clean-up work at power project sites were developed. An audit was completed on the location for ground material disposal and clean-up work as a result of work completed on the Blanda waterway.

Greenhouse gas emissions and carbon sequestration

Landsvirkjun aims to be a carbon neutral company and works systematically to reduce carbon emissions and other greenhouse gas emissions in its operations.

Carbon dioxide emissions from geothermal boreholes in Krafla, Bjarnarflag and Þeistareykir have been monitored for years. However, information on the natural emissions from geothermal fields is limited and a decision was made this year to increase research and therefore knowledge in this area. Carbon levels in the soil and vegetation at the Búðarháls Hydropower Station were measured, as a direct result of an assessment on GHG emissions in the Sporðalda Reservoir site area. Efforts to neutralise carbon emissions included an agreement with the Iceland Forest Service and the Icelandic Soil Conservation Service on carbon capturing in two new areas. An agreement was also reached with Kolvið on the neutralisation of all carbon emissions as a result of Landsvirkjun’s use of petroleum and diesel for transportation purposes, the air travel of employees, and the disposal of waste.

Information dissemination

Landsvirkjun is committed to successful cooperation with society by supporting transparent working methods and knowledge dissemination. Extensive information on environmental research can be found in Landsvirkjun’s Environmental Report. Research reports can presently be accessed at Landsvirkjun’s library but the objective is to make all these available via the web at Gegnir.is. The success of research carried out in the affected areas of the Fljótsdalur and Kárahnjúkar Stations can be accessed on the sustainability web run by Landsvirkjun and Alcoa www.sjalfbaerni.is.

Summaries and real time information on the monitoring of various environmental aspects can be accessed annually at Landsvirkjun’s website.

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