New opportunities with rising electricity prices in Europe
Hördur Arnarson, Managing Director of Landsvirkjun, discussed rising electricity prices in Europe at Arion Bank's breakfast meeting on energy issues. Mr Arnarson pointed out that it is possible to raise electricity prices in Iceland with a connection to the European market, e.g. by laying a submarine power cable.
Mr Arnarson spoke of changes in Icelandic and overseas electricity markets. He said that the option of using a submarine power cable had been under investigation since 1980 and that it had been technically feasible since 1995. He also revealed that rising electricity prices in recent years had made the project financially interesting. He also stated that the European market could become an addition to the current market but would not replace it.
Moreover, Mr Arnarson emphasised that Landsvirkjun did not anticipate any major exportation of electricity through submarine power cables, but rather that the company intended to sell surplus power to the European market when electricity prices there were at their peak. Mr Arnarson also pointed out the fact that electricity could be imported into Iceland by submarine power cable, thus making it possible to increase the security of power delivery by the Icelandic electricity grid.
Landsvirkjun will continue to examine the option of laying a submarine power cable taking into account the present changes in the European electricity market. Results are expected in approximately one and a half to two years at the earliest.