Heavy Industry Gets Cheap Energy in Iceland Skip to content

Heavy Industry Gets Cheap Energy in Iceland

By Iceland Review

Large-scale industrial companies in Iceland pay ten to 50 US dollars less for each megawatt hour of electricity than aluminum companies in the United States, as Hördur Árnason, CEO of the national power company Landsvirkjun, revealed at the company’s general meeting last month.

Harnessing geothermal energy in Iceland. Photo by Páll Stefánsson.

Árnason explained that all agreements Landsvirkjun makes with large-scale industrial companies include that the price of electricity changes with the price of aluminum, ruv.is reports.

Aluminum companies in other countries where such agreements exist pay 25 to 26 US dollars for each megawatt hour, according to numbers from January and February 2010.

There are also agreements on a so-called cost price, which is in fact the market price with a discount, Árnason stated. Companies with such agreements pay 37 to 44 US dollars per megawatt hour.

The market price is 59 US dollar per megawatt hour in Europe and 75 US dollars in the United States. Árnason claimed that aluminum companies which pay that price quickly go bankrupt.

Large-scale companies in Iceland pay USD 26 (EUR 20) per megawatt hour and so Icelandic electricity is up to USD 50 less expensive than the electricity in America.

Click here to read more about low energy prices in Iceland.

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