Energy resources in the Master Plan

Sources of energy that are covered by the Master Plan

The Master plan covers 

...geographical areas where there are power plant options for energy generation, both on privately owned land as well as on public lands."

(see Article 2 of the Master Plan Act). The Act defines the term power plant option as

The planned construction of a power plant for energy generation at a specified location." 

Energy resources which the Master Plan covers are those energy resources on which the largest part of the populations' energy generation is based - i.e. hydroelectric power and geothermal energy. In phase 3 wind power has been added.

Hydroelectric power and wind power are renewable energy resources. Geothermal energy (also called geothermal power) is a renewable energy resource only if less energy is removed from the geothermal system than flows into it from deep within the earth. Further discussion on energy resources, their renewability and sustainability can be found here.

Although the Master Plan only covers defined power plant options one must bear in mind that without utility facilities there is little reason for the construction of a power plant. That is why power companies and utility companies are frequently discussed in the same context. Iceland does not allow the same company to be engaged in both energy production and utility services. It is however obvious that without the energy companies the utility companies would not exist and vice versa.

Power plants in Iceland today

The number of hydro-electric power plants in Iceland today (2014) is nearly 50. The largest company by far is Landsvirkjun. The installed power of the hydro-electric power stations held by Landsvirkjun is nearly 1900 MW and energy generation per annum is more than 13,000 GWhours. The second largest producer of hydroelectric power in Iceland is Orkusalan with nearly 37 MW installed power and 80 GWhours energy generation per year. Orkubú Vestfjarða and Orka náttúrunnar each have 11 MW installed power in their 10 hydro-electric power plants. Other producers of hydroelectric power operate very small power plants that produce far less than 1% of the total hydroelectric power in the country.

There is a total of seven geothermal power stations in Iceland today and these are operated by four companies. By far the largest company in this field is Orka náttúrunnar with 423 MW installed capacity in the Hellisheiðar- and Nesjavalla power plants. HS Orka operates geothermal power stations at Svartsengi and in Reykjanes peninsula and their total installed capacity is nearly 180 MW. Landsvirkjun operates two geothermal power stations, one at Krafla and the other in Bjarnarflag, with a combined total installed capacity of 63 MW and an energy generation of 520 GWhours/year. The smallest geothermal power station in the country, with installed capacity of 2 MW and energy generation approximately 14 GWhours/year, is operated by Orkuveita Húsavíkur.

Wind power

The generation of power from wind is still in its experimental stage in Iceland. Since December 2012 the Landsvirkjun company has operated two windmills at Hafið located at the southern ridge of the highlands, right above Búrfell mountain by Þjórsá river. The experience gathered from this experimental activity has exceeded the most optimistic expectations and it is to be expected that wind energy will be harnessed at an increased rate her in Iceland in the future.

Landsvirkjun is still the only company that produces wind power into the electrical grid with the exception of two smaller windmills owned by the company Biokraft ehf. in Þykkvabær municipality. The financial importance of these energy resources for the country's economy and its companies is still small but will undoubtedly grow.

Energy and utility companies

In several instances energy and utility companies share their office staff and it is therefore easier to give an account of the total number of employees in the sector rather than divide up the individual jobs that are connected with energy generation and jobs connected with utility companies. This will be the method used here. The number of employees in the energy and utility companies in Iceland is over 1,200. Five of these companies have more than 100 employees and Orkuveita Reykjavíkur is the largest of these with 420 employees. When individual companies are studied it appears that the ratio of women employees is 12-30% depending on the company. Overall the percentage of women in the sector is 23%. Most women work office jobs and there are very few engaged in technical jobs. There are indications that the proportion of women holding technical jobs is steadily growing.

The main characteristics for human resources in the energy and utility sector is on the one hand the high educational level of the workforce and on the other hand their long period of service. The proportion of employees with university degrees is the same as the proportion in the general labour market in Iceland but the proportion of trade school educated employees is significantly higher. Salaries and wages in this sector are also quite high compared to similar sectors and this is caused by the long period of service and the higher age of the employees.


Sources: Websites and annual reports of the energy companies