Renewable energy

The European Investment Bank has signed three loans totalling 157 million Euros to finance the construction and operation of two geothermal electricity generation and transmission facilities in the southwest of Iceland.

The European Investment Bank (EIB) has signed three loans totalling 157 million Euros to finance the construction and operation of two geothermal electricity generation and transmission facilities in the southwest of Iceland.

They will be built and run by the country’s three largest energy companies: Landsvirkjun (who will receive 50m Euros), Reykjavik Energy (who will receive 77m Euros) and Hitaveita Sudurnesja (who will receive 30m Euros).

The project consists of the development of two geothermal fields and the construction of two new geothermal cogeneration plants of 80MWe/266MWth and 100MWe respectively, plus a new high-voltage transmission line.

The power plants will provide Nordural’s expanded aluminium plant with competitively-priced energy. Electricity will also be supplied to the municipal distribution grids in the southwest of Iceland as well as to the national power grid. The geothermal plants will also produce heat – in one case for district heating and, in the other, for industry.

By contributing to the growth of the aluminium industry, the EU expects the investments will also have a positive economic impact on Iceland’s economy.