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06. júní 2018 Atvinnuvega- og nýsköpunarráðuneytið

Ræða Þórdísar Kolbrúnar R. Gylfadóttur á ráðstefnunni „Empowered – Icelandic energy solutions for Europe“, Berlín 30. maí 2018

State Secretary Bareiss, Ambassador Eyjólfsson, dear guests.

If one of the most important current challenges of mankind is to end our reliance on fossil fuels, then the Icelandic population has been blessed with some of the world’s most meaningful and beneficial resources.

By using renewable hydro- and geothermal-energy to produce electricity and heat our buildings, we have managed to practically eliminate the use of fossil fuels in all sectors except transportation.

It is really the central role of geothermal in district heating which sets Iceland apart from most other countries – and this is also of special importance from a global warming standpoint.

If we still had to use oil to heat our buildings in the cold climate of Iceland, our annual CO2 emissions would increase by 30% or almost 1,5 million tons, which is roughly equivalent to the annual emissions of 200 thousand passenger cars. That is quite a significant footprint for a nation of only 330 thousand people.

And over the course of the last hundred years, replacing fossil fuels with renewable energy in Iceland has resulted in combined CO2 savings of over 350 million tons. This is roughly equivalent to the benefit of planting trees in an area covering the combined area of France and Great Britain.

Not bad for such a small nation. As the electronic band Depeche Mode pointed out back in 1983: Everything counts in large amounts.

Now let us take a moment to review Iceland’s history of using these renewable resources, with an emphasis on geothermal.

The old Icelandic Sagas confirm that we have been using the geothermal resource since the age of settlement, as early Icelanders used the hot springs for bathing, and to wash their clothes.

However, it seems that geothermal springs were for a long time not considered an asset of any significant value. An 18th century description of a well-known property rich in geothermal springs states that the hot springs do contribute to some savings of firewood for the farmer, but on the other hand they also regularly claim the lives of valuable livestock. So, it seems the net value was perceived to be close to zero, and this was the case for centuries.

We know that the Icelandic practice of making a special kind of bread by baking it in hot earth has been around since at least the 18th century, perhaps longer. Some sources also suggest that the hot springs themselves may have been used directly to boil food.

But the earliest effort in Iceland to harness a geothermal site as a potential industrial resource were made at the very dawn of the Industrial Revolution, in the year 1755, when drillings were made in a failed attempt to mine Sulphur. As far as we know, this was the first drilling made at a geothermal site anywhere in the world, with a second attempt a year later reaching a depth of 10 meters before the project was abandoned.

Several decades later, in the early 19th century, facilities were installed for large scale washing of clothes at the main hot spring area in the capital, Reykjavík. And a few years later, Icelanders began growing potatoes in warm earth at geothermal sites around the country.

But it was not until the 20th century that we made our first attempts at heating our houses using water or steam directly from hot springs. The first successful attempt is believed to have been made exactly 110 years ago, in 1908, but the practice did not become widespread.

A few years later the first geothermally heated greenhouse was built for growing vegetables, which has since become a significant industry in Iceland.

In 1928, 90 years ago, the first proper drillings for hot water were made in Reykjavik, and I am pleased to report that the drill which was used was made in Germany. The drillings were a success and two years later, geothermal heating had been installed in the National Hospital, two city schools, the city swimming pool and 60 households. Three years after that, in 1933, some 3% of households in Reykjavik had geothermal heating. Progress was relatively slow in the years that followed, but nevertheless, in 1944, the year of Icelandic independence from Denmark, geothermal heating had reached over 10% of households in Reykjavík.

Subsequent years saw greatly increased research into potential geothermal projects around the country, with more and more municipalities following the example of the capital. And to make a long story short: Throughout the next few decades we managed to practically eliminate the use of fossil fuels for heating. In 1971, no less than 98% of residents in Reykjavík city had geothermal district heating. Soon after, the oil crisis led to a concentrated effort to further reduce our reliance on oil by installing geothermal heating in the rest of the country, which was completed within two decades. Today, nine out of ten houses in Iceland are heated directly with geothermal heat, through district heating systems, and a further nine percent are heated with renewable electricity. Only about 1% are heated with fossil fuels. The result is an enormous benefit to the environment, both locally and globally, not to mention the long term economic benefit.

But it is important to note that this transformation did not happen without significant government intervention. In the sixties, the government established a National Energy Fund which offers loans to fund the initial cost of drilling and exploration. If the initial drilling turns out to be unsuccessful, the loan defaults to the state. In Iceland, this policy promoted the expansion of geothermal energy more than anything else.

In addition to actively pushing for a complete transformation of our district heating over to geothermal energy, we also have increasingly used geothermal for electricity production. Currently, some 30% of our electricity is produced at geothermal power plants while hydropower makes up around 70%.

Now we turn to the question: What is the relevance of all this to the international community and specifically Europe?

The fact is that heating and cooling accounts for approximately half of final energy consumption in the European Union. And the overwhelming majority of the energy required for this heating and cooling, or approximately three quarters, comes from fossil fuels. It seems quite clear that Europe cannot reach its climate goals without sharply reducing the footprint of heating and cooling.

Reviewing the various policy papers, I must admit that I miss stronger emphasis at EU level on the potentials of geothermal energy to address this challenge.

When it comes to heating, electricity is not a first choice. Anyone who has driven an all-electric car can confirm that using electricity for heating is not the most efficient use of energy. From a purely theoretical standpoint, it makes much more sense to use geothermal heat rather than electricity to replace fossil fuels for district heating, along with heat from industrial processes which would otherwise go to waste.

But is the resource available in mainland Europe? The answer is yes. Mainland Europe has considerable resources of geothermal water of temperatures above 70 degrees Celsius, which may not be ideal to produce electricity, but is very practical indeed for district heating, domestic hot water and suitable industrial uses such as greenhouses and aquacultures.

Promoting a replacement of fossil fuels by this geothermal energy might very well turn out to be the most cost-effective way to reduce CO2 emissions within the EU.

The limiting factor here is not primarily the lack of the natural resource but the lack of infrastructure, and of research and development. But nevertheless, there are today over 240 geothermal district heating systems operated around Europe, including one in Paris, which has one of the largest geothermal district heating systems in the world. And in addition, there are about 5.000 district heating systems in Europe which use other energy sources, mainly fossil fuels. There are clear opportunities to expand the use of geothermal for heating, both with new district systems as well as replacing fossil fuels with geothermal in systems that are already in place.

So, may the EU could benefit from our experience on how we used government incentives to promote the transformation of central heating away from fossil fuels towards the renewable resource of geothermal heat, at great benefit to the environment, both locally and globally, as well as a very significant economic benefit in the long term.

Given the nature of the majority of existing infrastructure in Europe, this would certainly be a considerable challenge. But if Iceland could do it – a poor country by Western standards for much of the 20th century – today’s mainland Europe certainly stands a chance.

I mentioned a push was needed in research and development as well as infrastructure. There is a need for advanced scientific work, bringing together knowledge from various disciplines of science and engineering, to develop and apply more cost-effective solutions for geothermal utilization. Even if we were to reach a relatively modest goal of 20% geothermal heating in the European Union, this would require considerable efforts to expand the potential and improve the cost-effectiveness, both through technological advances and government incentives. But the benefits are great, and once again: This sector is responsible for half of the European Union’s final energy consumption.

Other Scandinavian countries are important role models as well. Even though they lack deep geothermal resources, they have a high coverage of district heating systems and have developed them into a platform for effective use of various renewable energy sources as well as waste energy sources.

Dear guests,

Iceland has for a long time been assisting other countries in utilizing their geothermal resources, providing training of geothermal specialists and technical assistance.

Back in 1969, almost fifty years ago, an Icelandic engineering firm was established for the sole purpose of exporting geothermal know-how. Among their first projects was the development of a geothermal power plant in Olkaria in Kenya.

Kenya now has significant electricity production in the rift valley, partly through co-operation with Icelandic partners. And in China, Icelandic participation has contributed towards low temperature district heating which has now surpassed the heated building volume in Iceland.

These are examples of the active Icelandic geothermal industry, which participates in various projects around the world, including research, consulting, design and construction. The cumulative knowledge of our experts in this field for many decades has become an important export product for Iceland and I know that we will be hearing directly about those experiences later today from our panel.

I cannot conclude this introduction without mentioning one of Iceland’s proudest contributions in the field of energy, which is the United Nations University “GTP” or Geothermal Training Program. This program, which from the start has been based in Iceland, last month celebrated its 40th anniversary. Over 40 years we have trained no fewer than 670 scientists and engineers from 60 countries all over the world, and 24 are currently enrolled in the program, so we are quickly approaching 700. We would like to think that these are 700 ambassadors for geothermal energy. And we are proud to have contributed in this area in a significant and meaningful way.

At the Icelandic Geothermal Conference in Reykjavík last month, I said that we needed a coordinated international effort, to build a better connection between the possibilities of geothermal utilization and the ambitious goals put forward in the Paris Agreement and in the 2030 UN Agenda for Sustainable Development.

It was pointed out in the opening session of the conference that general awareness of geothermal energy is, regrettably, fairly limited on a global scale. The concept of renewable energy is generally connected to solar, wind, hydro and bio-fuels, while geothermal energy is often not recognized. This is something we need to change. If there is one thing you take away from this conference, it should be this point.

In 2020 Iceland will host the “World Geothermal Congress” in Reykjavík, the so-called “Olympics of Geothermal Energy” as this event has been referred to. We are proud to have been selected to host the event, which takes place every five years, and we are very much looking forward to it.

We expect some 3.500 delegates to attend. Hopefully some of you will be there, to continue the dialogue on how we can take the next steps towards implementing sustainable energy solutions.

In closing I would like to thank the Iceland Embassy here in Berlin for contributing to our part in providing a platform for these important discussions, and I greatly look forward to the other presentations and panel discussions that make up our very exciting agenda today.

Thank you.


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