Environment Minister Rejects Plans for Hydro Plants Skip to content

Environment Minister Rejects Plans for Hydro Plants

Minister for the Environment Svandís Svavarsdóttir announced on her ministry’s website on Monday that development plans for hydropower plants in the lower Thjórsá river will not be approved, as the participation of Landsvirkjun, the National Power Company, in the cost of development for the municipalities concerned is at odds with organization and construction laws.

“It delays the industrial development which would have been based on possible energy from the lower Thjórsá,” CEO of Landsvirkjun Hördur Arnarson told visir.is of the minister’s decision. Landsvirkjun had been negotiating with a number of companies, he said, but now further negotiations will be postponed.

Landsvirkjun began the first designs for the power plants 11 years ago and the Icelandic National Planning Agency and the then environment minister agreed to the operations six years ago and again three years ago.

Arnarson said extensive work and money—ISK 3.7 billion (USD 29 million, EUR 21 million)—has been invested in the project, as a large part of permits were already at hand.

The board of Landsvirkjun decided two years ago that the energy from the Thjórsá plants should not be used for new aluminum smelters but instead launched discussions with other types of companies.

These companies operate in fields such as server farms and silicon chip production—Thorlákshöfn had been mentioned as a possible location for a silicon chip factory.

According to Stöd 2’s sources, foreign companies from these sectors have become keener on purchasing energy in recent months, as are companies involved in food and steel production.

Regarding a data center, which is under construction, Arnarson said Landsvirkjun has sufficient energy in the system for the first stages but that other harnessing options must be considered for future operations.

Click here to read about another controversial decision made by the environment minister.

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