Clean heating, carbon storage, and direct air capture: How Iceland could carve out a net zero economy for the world to follow
Half an hour’s drive from Reykjavik, several racks of giant fans are erected on billboard-sized metal blocks, primed and ready to suck carbon dioxide from the cold Icelandic air. The unusual-looking contraption is a curious addition to a sparse, volcanic landscape dominated by the various pipes, turbines, and funnels of the country’s largest geothermal plant, the Hellisheidi power station. Thick pipelines criss-cross the energy park, stretching from the power plant to the horizon, as well as to a number of futuristic-looking geodesic domes.
This infrastructure is all part and parcel of the world’s first commercial direct air capture (DAC) operation, a scheme that generated headlines around the world last month when its developer, Swiss outfit Climeworks, announced the machine had started sucking carbon dioxide from the Icelandic air. The geodesic domes installed nearby cover boreholes where CO2 captured by the DAC plant is injected for permanent storage into the bedrock.
Climeworks estimates the plant – which is named Orca, the Icelandic word for energy – can draw 4,000 tonnes of carbon dioxide out of the atmosphere each year, roughly equivalent to the annual emissions produced by 870 US cars. While the capture and storage of such a meagre amount of CO2 will have a indetectable effect on global temperatures, the plant’s launch was hailed by a landmark moment for the nascent negative emissions technologies sector. The hope is that it could yet prove to be a major step forward in the transition towards net zero global emissions.
Despite not wholly unfounded fears from some green groups that DAC could prove to be an expensive distraction from climate solutions that can directly reduce emissions in the short-term, this summer’s IPCC report stressed that large-scale carbon dioxide removal solutions would be critical for bringing spiralling temperature increases under control in the – increasingly likely – scenario where the targets set out in the Paris Agreement are breached. As such governments around the world have faced growing calls from climate experts and industry players to invest in the first wave of DAC and other negative emissions solutions that could one day remove CO2 from the atmosphere at scale. Despite its modest performance and extortionate cost, Orca could yet mark a turning point in the global mission to avert a rolling climate catastrophe.
The comissioning of the Orca plant is also a major clean technology coup for Iceland, adding to legacy of clean energy innovation in the nation that dates back several decades. Climeworks may be headquartered in Switzerland, but the scheme has benefitted from a number of distinctly Icelandic attributes, from its supply of cheap, clean geothermal energy produced by the Hellisheidi power plant to the volcanic rock it stands on, geology that provides the conditions for cost-effective carbon storage.
To safely and permanently store CO2 sucked from the atmosphere by its fans, Climeworks has partnered with Icelandic outfit Carbfix, a start-up which has spent the best part of a decade developing a method to turn carbon emissions into stone. Mimicking a carbon storage process that happens in nature, Carbfix’s technology mixes captured CO2 with warm water and then injects it deep underground. When the fizzy liquid comes into contact with basalt – the porous, volcanic rock that forms much of Iceland’s bedrock – it binds with it, becoming trapped permanently in stone within two years.
Carbfix’s innovative carbon capture and mineralisation solution is part of a proud tradition of clean energy innovation in Iceland. The country is a clean energy pioneer, having transitioned from an economy heavily dependent on imported fossil fuels in the first half of the 20th century to a place where almost all homes are now heated and powered by hydropower or geothermal energy. And now, as the race to decarbonise the global economy gathers pace, firms headquartered in Iceland, including Carbfix, are eyeing opportunities to spread learnings from their small island nation further afield.
For a country with a population roughly the same as Stoke-on-Trent, Iceland has produced a signifant number of start-ups working to accelerate global decarbonisation projects. Carbfix may be the country’s research and development project du jour but is by no means the only Icelandic firm that has developed cutting edge green solutions that are now making waves around the world.
For example, the world’s largest geothermal district heating company, Sinopec Green Energy – a firm that has helped decarbonise heating for millions of people in China and is now eying European expansion – was the brainchild of, and is part-owned by, Icelandic district heating outfit Arctic Green Energy Corporation. Meanwhile, another home-grown Icelandic company, Carbon Recycling International, has developed an innovative technology which transforms carbon emissions into ‘renewable’ methanol that can be used as a shipping fuel or to make polymer and plastic. Proven and tested at a geothermal plant in Iceland, a major methanol facility is now planned in China based on the technology.
Indeed, as countries around the world scramble to find ways to reduce the carbon emissions generated by the home heating and power generation in order to meet climate goals, Iceland is well ahead of the curve. In the wake of the 1970s oil crisis, Iceland’s political leadership took the decision to ramp up the country’s supplies of geothermal and hydroelectric power so as to cut its dependence on expensive imported fossil fuels, setting up a drilling fund that provided loans to geothermal project developers and covered the cost of failed projects. Today, nine out of 10 homes in the country are powered by geothermal district heating, with the remainder heated by electricity. Household electricity, meanwhile, is fully powered by renewables, with geothermal generation accounting for 30 per cent and hydropower the rest.
This low emission economy is enabled by Iceland’s unique geology. Sitting at the intersection of two tectonic plates, the country is home to hundreds of volcanoes and a large number of hot springs. As such, it has bountiful sources of hot, easily accessible underground water that can power district heating schemes and be converted into power generation for homes and business. The country’s rich geothermal resources have also drastically improved food security in recent decades, with the nation’s traditional harvest of potatoes and beetroot being much improved by crops of bell peppers, cucumbers, and tomatoes grown in greenhouses illuminated and heated by geothermal energy.
However, speaking to BusinessGreen, Arni Magnusson, CEO of Iceland’s Geological Survey (ISOR), a research organisation that also provides geothermal energy drilling consultancy services to governments and companies, stresses that Iceland owes its clean energy evolution as much to its bold political decision making as its geology. “We were forced on this track because of the oil crisis [in the 1970s],” he says. “A decision was made to get more energy independence. We were lucky to have the resource, but we are not the only ones to have the geothermal resource with potential utilisation for heating; that is very widespread.”
Moreover, Iceland’s experience highlights some of the economic benefits that can flow from a suitable ambitious clean energy strategy. The nation’s clean energy evolution has had a catalysing effect on the Icelandic economy, transforming the country from a relatively poor nation dominated by fishing and sheep farming to an affluent country that that attracts international investment from energy-intensive sectors looking to tap cheap and clean energy for their operations, in particular aluminium smelters and data centre companies.
Hildigunnur Thorsteinsson, MD of research and innovation at state-owned power company Reykjavik Energy, says there is a direct link between clean energy innovation coming out of Iceland and the country’s abundant geothermal resources. “Although they are very small, my young daughters know that the hot water in the radiators comes from the earth,” she tells BusinessGreen. “They see the boreholes around Reykjavik, they’ve seen the geothermal areas, they’ve seen a volcano, they’ve walked through it. You really feel it… Because energy is so ingrained in everything we do, it attracts good potential.”
Thorsteinsson also points out that industry players have played a major role in making clean energy front of mind and accessible to Icelanders. Power plants across Iceland remain open to the public and tourists, and the Hellisheidi power plant where Carbfix is based receives roughly 100,000 visitors every year, with an invitation to visit the station extended to every ninth grader living in Rejkjavik, she explains. This gives energy companies greater license to take bold action, she argues. “It is important for the public to know where their energy comes from,” she says. “If we are ever going to get the public with us to conserve and change – we’re always changing and we will over the next decades – they have to know why, how and what we are doing, and be a part of the process.”
Not all countries are blessed with abundant and easily accessible geothermal energy resources, but geothermal drilling technologies are improving fast and most nations now have some form of cost competitive clean energy resource available to them if they are willing to introduce the policies and make the investments that can unlock it. Iceland has a good chance of becoming one of the world’s first net zero emission economies. The hope is that many more can learn from its trail-blazing experiences.
Cecilia Keating’s trip to Iceland was organised and funded by Green by Iceland. The second part of her report on the country’s burgeoning clean tech sector will run tomorrow.
