Iceland is a Nordic European island country situated at the confluence of the North Atlantic andArctic Oceans, on the Mid-Atlantic Ridge. The country has a population of about 320,000 (2012) and a total area of 103,000 km2 , which makes it the most sparsely populated country in Europe. It seems that the government of the country has taken into advantage all her natural characteristics, such as the volcanic roots of the island in order to produce electricity. Today, Iceland’s electicity is generated with renewables 100%: 75% is based on hydro and 25% on geothermal resources(coal and oil were its previous resources). Moreover, the needs for hot water and heat are grounded by 87% on geothermal energy.
Fumarole field on the Reykjanes peninsula, Iceland.
In total, the required energy for the sectors of electricity, heat and trnsportation are based on hydro and geothermy by 81%*, a percentage that is thought to be a record in the modern era as Icelandic politicians think so. An important point that is mentioned By Paul Gipe is that electricity production by 50% is proviede to aluminum smelters at a lower price, while there is no bauxite in the island. This happens because government aims at profiting by attracting smelters to the island with the motive of providing them energy in a low-and also stable in the long term- cost.
Iceland has as ultimate goal to be fully dependent on renewable energy resources and moreover to sell energy to energy intensive industries such as British Isles. Based on this scenario Iceland has proposed an unprecedented 700 mile sub-sea cable to Scotland, that costs around 2 billion dollars, in order to carry 5 TWh to Britain’s energy markets**. An amount of energy that is a third more electricity than produced at the present in all of Iceland. Even if this project is economically and technically feasible Iceland certainly has the untapped geothermal potential to do so. But are transmission costs low enough to hold the price of electricity based on geothermal resources cheaper than if Britain developed its own geothermal resources?
Sources: * http://www.nea.is/ **Bloomberg
The original article is here http://www.wind-works.org/Solar/IcelandanExampleoftheHighPenetrationofRenewables.html