Minister of Industry to Submit Power Privatization Bill - The Reykjavik Grapevine

Minister of Industry to Submit Power Privatization Bill

Published August 6, 2010

In response to the Magma Energy controversy, Minister of Industry Katrín Júlíusdóttir told the television news show Kastljósið last night that she intends to submit a bill to parliament which would change the way municipalities do business with private companies.
The bill in question would limit the number of years a private business could be in contract with an Icelandic municipality with regards to power companies. The bill is in response to the length of Magma Energy’s contract with the town of Reykjanesbær. Magma Energy has exclusive rights to geothermal exploration and use in the Reykjanes area for the next 65 years – provided the Icelandic government, which has temporarily frozen Magma’s purchase of HS Orka, doesn’t ultimately kill the deal.
The minister also said that she doesn’t necessarily see a reason to fear private enterprise in the energy sector. When the previous conservative government privatized energy companies, they left the door open for private concerns to purchase them. The minister has previously argued that the nationality of the private enterprises in question should not especially matter.
If the minister’s bill passes into law, private companies – regardless of national origin – would be much more greatly limited in how long they could engage in contracts with municipalities. The Icelandic Chamber of Commerce has already criticized the government for being too strict when it comes to laws on foreign private investors.

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