From Iceland — Former Landsvirkjun CEO: More Aluminum Plants = Cheaper Electricity

Former Landsvirkjun CEO: More Aluminum Plants = Cheaper Electricity

Published October 8, 2009

The former CEO of power company Landsvirkjun, Jóhannes Geir Sigurgeirsson, gave a presentation at a meeting of Icelandic Energy and Utilities, where he argued that building more aluminum plants would result in lower electricity bills for the average Icelander.
Vísir reports that Sigurgeirsson essentially linked correlation with causality – between the years of 1997 and 2008, the Icelandic electricity bill reduced by 30%. At the same time, the electricity usage in heavy industry increased dramatically. Sigurgeirsson believes these two phenomena are related, because Icelandic homes within the region of a heavy industry – such as an aluminum smelter – enjoy the spillover of the power used by these plants.
Jón Þorvaldur Heiðarsson, a lecturer at the University of Iceland in Akureyri, contends that such reasoning does not hold. The residual effect of heavy industry increasing in size is that more possibilities become available to lower power costs to the public.
Chairman of the Icelandic Environment Association Björgólfur Thorsteinsson argues additionally that the environmental effects of heavy industry, including their residual effects on the cost to the public, are not taken into account in Sigurgeirsson’s assessment. He cites as an example the Southwest Power Cable, which is supposed to deliver electricity to the aluminum plant in Helguvík. This cable, he contends, has caused significant environmental damage, lowering the value of the land it travels through.
Heavy industry is a contentious subject in Iceland. While many Icelanders living in small towns see the arrival of aluminum smelters as having been an employment blessing in areas where few jobs are available, others have expressed environmental concerns, as well as the fact that the companies initiating these projects are usually not based in Iceland.

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