Landsvirkjun

Overview of IceLink

The first proposal to connect Iceland’s electricity grid with Scotland’s, via a submarine cable was introduced over 60 years ago. The feasibility of such a project has been regularly assessed over the last 30 years. Historically, the result of this research showed that such a project would be technically possible but would not be a profitable endeavor.

Research conducted by Landsvirkjun, in collaboration with Landsnet, between 2009 and 2010 shed new light on the potential of such a project; that it could in fact be economically viable. The main rationale behind this shift was higher electricity prices in Europe and an increased demand for renewable energy sources, with no or low emission of greenhouse gases.

To further explore the technical and economic feasibility of the interconnector, Landsvirkjun, Landsnet and National Grid engaged in a project partnership in 2013. Pre-feasibility studies carried out since have indicated comprehensive benefits of the interconnector, which has been termed IceLink. At the end of 2015, the prime ministers of UK and Iceland met and established a task-force whose task is to evaluate the project and advise on the next steps taken by the governments. Results are expected by middle of 2016.

It is estimated that it will take around five years to complete studies on feasibility and other preparatory work. Should the project enter the next phase after that, a further five to six years will be needed for the production and installation of the cable, the necessary onshore construction and other related tasks. The project could thus commence operation in the second half of the next decade.

IceLink is on the European Union’s list of key energy infrastructure projects (Projects of Common Interest). These projects are considered essential for reaching the EU’s energy policy objectives. Benefits of being on the list include accelerated planning and permit granting and possible financial grants.

Overview of IceLink  

Technical

  • The interconnector will be over 1000 km long, 800-1200 MW HVDC transmission link connecting Iceland to GB, and offering bi-directional flows.
  • Onshore windand geothermal plants will be developed to displace current flexible hydro assets for export.
  • The entire Icelandic hydro system will provide flexibility to GB following a number of upgrades to the system.

Commercial

  • IceLink is a project in a feasibility stage, designed to deliver renewable, flexible generation to Great Britain from 2027.
  • IceLinkwill deliver a volume of >5 TWh flexible renewable electricity per annum, enough to power 1.6 million homes.
  • We anticipate that the total cost to the UK consumer will be competitive with other domestic low-carbon alternatives.

Rationale for IceLink -significant contribution  

Market integration

  • IceLink lifts the isolation of the Icelandic electricity market and it assists Europe to achieve interconnection capacity targets amounting to 10% of installed capacity, and it opens up new markets for both Icelandic and UK suppliers.
  • Through bi-directional flows, IceLink could potentially reduce the cost of managing constraints between northern GB and the major consumption centres further south as energy is directed to Iceland at times of excess wind power generation in the north, stored in hydro reservoirs, and returned at times of lower wind output.
  • By providing flexible energy in near term spot markets and the balancing mechanism, IceLink can lower the cost of balancing, in particular in a system with a high penetration of intermittent generation.

Security of supply

  • IceLink connects currently isolated Iceland´s renewable electricity system with the broader European system and offers a means to decrease Europe´s dependency on imported fossil fuels in a cost efficient way.
  • IceLink increases diversity of power supply at both ends and enhances further deployment of renewables through coupling highly flexible hydro generation with that of intermittent wind and solar generation.
  • IceLink delivers reliable and flexible energy into the GB system at times of thin supply margins.
  • IceLink allows energy to flow to Iceland at times of low hydro generation potential, e.g. due to unusually low precipitation levels.

Sustainability

  • Iceland generation is 100% renewable. The interconnector would provide an export opportunity for the surplus energy in the renewable hydro system that is not currently harnessed due to economical and operational limitations.
  • The UK has committed itself to ambitious reduction of greenhouse gas emissions. IceLink contributes with its lower cost of low carbon energy compared to domestic marginal alternatives and its flexibility contributes to reducing the cost of enabling the integration of UK intermittent renewables.
  • IceLink involves the deployment of relatively mature low carbon technologies. As such, it allows GB to reduce reliance on particular domestic technologies, thereby reducing exposure to lower than expected cost reduction trajectories.

Reports

Below are links to reports and news in English. A larger list of reports and news in Icelandic is available here.


Title Source Date
Low carbon network infrastructure Energy and Climate Change Committee, UK Parliament 17.06.2016
Smart Power - government responce to the National Infrastructure Commission's report UK Treasury 13.04.2016
Iceland-UK Interconnector: A Brief Analysis of Possible Risk Mitigation and Dispute Settlement Andri Dan Traustason and Hilmar Þór Hilmarsson, article published in the Journal of Applied Management and Investments 01.04.2016
Smart Power - Connecting to Iceland National Infrastructure Commission (UK) 04.03.2016
Iceland - UK Interconnector: Is Proper Political Risk Mitigation Possible? Andri Dan Traustason and Hilmar Þór Hilmarsson, article published in relation to the International Scientific Conference on Project Management in the Baltic Countries 01.02.2016
North Atlantic Energy Network National Energy Authority of Iceland, The Arctic University of Norway, Danish Energy Agency, Faroese Earth and Energy Directorate, Shetland Islands Council og Greenland Innovation Centre 01.01.2016
HVDC Submarine Power Cables in the World Joint Research Centre, European Commission 31.12.2015
SA-Business Iceland Conference on an interconnector to Europe: The Experience of Norwegians and the Icelands opportunities in Europe’s Energy Market  David Bothe from Frontier Economics, Tor Eigil Hodne from Statnett and Geir Arne-Mo from Bergen Energi  13.11.2015
Near-Term Interconnector Cost-Benefit Analysis: Independent Report Pöyry 01.12.2014
Tender: Mat á áhrifum raforkusæstrengs (Icelandic) Central Public Procurement (Ríkiskaup) 10.03.2015
Infrastructure 100 World Markets Report KPMG Global 18.11.2014
Ten-Year Network Development Plan 2014 European Network of Transmission System Operators for Electricity (ENTSO-E) 28.08.2014
Sub-Sea Electrical Cable Connection to Europe (Results and recommendations of the advisory group commissioned by the Minister of Industries and Innovation) Ministry of Industries and Innovation 26.06.2014
Getting Interconnected: How can interconnectors compete to help lower bills and cut carbon? Policy Exchange 12.06.2014
Discussions in Alþingi: Interconnector to Europe (Icelandic) Alþingi 13.02.2014
The Industrial Affairs Committee of Alþingi on report of macroeconomic impact of seacable (Icelandic) Alþingi 30.01.2014
Electric submarine cable: Feasibility of investing in a submarine cable from Iceland to the UK (Icelandic) Þorsteinn Guðbjörnsson, BSc thesis written under supervision of Guðmundur Magnússon at University of Akureyri 21.01.2014
Iceland-UK Interconnector: Strategy for Macroeconomic and Legal Feasibility Randall Morgan Greene, MSc thesis written under supervision from Jónas Hlynur Hallgrímsson from the University of Reykjavik  14.12.2013
Will Icelandic households benefit from a sub-sea cable to Britain Asgeir Jonsson, economist at GAM Management 01.12.2013
The Icelandic Energy Summit 2013 London - IceLink Interconnector (slides) Hordur Arnarson, CEO Landsvirkjun, and Paul Johnson, head of development National Grid 02.11.2013
The Icelandic Energy Summit 2013 London - IceLink Interconnector (video) Hordur Arnarson, CEO Landsvirkjun, and Paul Johnson, head of development National Grid 02.11.2013
Submarine cable and benefits to households (Icelandic) GAM Management 01.09.2013
Submarine Cable to Europe - Conclusions and Recommendations of the Advisory Group to Minister of Industry and Commerce (Icelandic) Advisory Group to Minister of Industry and Commerce 26.06.2013
Electric submarine cable: Is it worth it to connect? (Icelandic) Gunnar Friðrik Hermundarson, BSc thesis written under supervision of Gylfa Zoëga at University of Iceland 01.06.2013
Experience in transporting energy through subsea power cables: The case of Iceland Svandís Hlín Karlsdóttir, MSc thesis written under supervision of Rúnar Unnþórsson and Tómasar Philip Rúnarsson at University of Iceland 01.05.2013
Macroeconomic impact of submarine cable (Icelandic) Insitute of Economic Study at University of Iceland 01.05.2013
Is the submarine cable in sight - Presentation for Icelandic Association of Chartered Engineers (Icelandic) Jón Ingimarsson, Landsvirkjun 08.03.2012
Memorandum on environmental impact (Icelandic) Environice 12.02.2012
Landsvirkjun’s Renewable Energy Potential and its Impact on Iceland’s Economy GAM Management 12.09.2011

News

Below are links to reports and news in English. A larger list of reports and news in Icelandic is available here.

Title Source Date
Fire and Ice Audi Magazine 20.06.2016
Regulating electricity interconnectors - The GB perspective - Advanced Submarine Power Cable and Interonnection Forum Stuart Borland, Ofgem 14.06.2016
Lessons learned from a project developer - Advanced Submarine Power Cable and Interonnection Forum Martin Moran, National Grid 14.06.2016
Shetlands could be northern supergrid hub Shetland News 07.03.2016
UK needs a ‘smart power revolution’, says Infrastructure Commission Carbon Brief 04.03.2016
Written Question - Corri Wilson MP (SNP, Ayr, Carrick and Cumnock)  Electricity Interconnectors: Iceland UK Parliament 19.02.2016
Ministers consider linking UK's National Grid to Norway in bid to harness country's green energy Independent 13.02.2016
Energy for Everyone? Iceland Review 01.01.2016
House of Lords Debate - Electricity System Resilience (1) (2) (3) (4) (5) UK Parliament 03.11.2015
Interconnector could bring volcano power to UK OSJ 10.11.2015
Cameron wants sea cable to bring lava power from Iceland The Sunday Times 01.11.2015
Icelandic volcanoes to power Scotland through subsea cable Herald Scotland 30.10.2015
Multi-billion pound plan to power UK homes with Icelandic volcanoes within 10 years ITV 29.10.2015
Iceland's volcanoes could power British homes (á ensku) Sky News 29.10.2015
Britain and Iceland to revive volcano power project  Reuters 29.10.2015
Icelandic volcanoes could power British homes RT 29.10.2015
Volcanoes in Iceland could provide power to British homes through 750 mile-long undersea cable The Mirror 29.10.2015
David Cameron to announce plan to power UK by harnessing Iceland's volcanoes The Independent 29.10.2015
UK and Iceland consider setting up undersea electricity pipeline Politics Home 29.10.2015
Iceland volcanoes may provide electricity for Britain, David Cameron to announce Business Reporter 29.10.2015
Contract Award for the World's Longest HVDC Route Survey MMT 15.06.2015
The Changing Arguments for Cross-Border Electricity Transmission - Advanced Submarine Power Cable and Interonnection Forum Benedikt Unger, Pöyry 11.05.2015
UK Affirms Interest in IceLink Interconnector Askja Energy 02.03.2015
Challenging deployment of renewables in the North Atlantic Norden 01.02.2015
Ireland and United Kingdom are Best Options for Electricity Exports from Iceland Askja Energy 23.12.2014
UK-Iceland Cable on the Global Infrastructure 100 List Askja Energy 02.12.2014
UK Energy Investors Looking Towards Iceland Askja Energy  12.11.2014
IceLink Offers High Increase in Social and Economic Welfare Askja Energy 04.11.2014
Profitability of energy exports: Minister‘s address Ministry of Industries and Innovation 10.09.2014
Profitability of energy exports: Ole Borten Moe VIB.is 10.09.2014
Icelandic Hydropower Offers Great Possibilities for the UK Askja Energy 02.07.2014
The Importance of Diversifying Europe's Energy Sources Askja Energy 06.05.2014
Feasibility of IceLink (Iceland-UK Interconnector) Askja Energy 30.04.2014
UK is Looking to Iceland for Electricity Askja Energy  10.04.2014
Written Question Andrew Rosindell MP (Con, Romford) - UK-Icelandic business relations UK Parliament 28.04.2014
Study of Cost of IceLink: 2.7 billion USD Askja Energy  10.03.2014
Written Question Dr Alan Whitehead MP (Lab , Southampton  Test)  - Electricity Interconnectors: Iceland UK Parliament 12.03.2014
Written Question Jonathan Reynolds MP (Lab, Stalybridge and Hyde) - Electricity Interconnectors: Iceland UK Parliament 11.03.2014
Icelandic Electricity Would be Competitive in the UK Askja Energy  25.02.2014
UK Will Import More Power from Neighbouring Countries in the Future Askja Energy  03.02.2014
UK National Grid: IceLink is Feasible, Achievable and Viable Askja Energy 27.01.2014
Power under the sea The Economist 20.01.2014
University Research on HVDC Development  Askja Energy 13.01.2014
UK National Grid Showing Interest in IceLink Askja Energy 06.01.2014
Interesting Development in UK Electricity Strike Prices Askja Energy 18.12.2013
Upcoming New World Record Subsea Electric Cables Askja Energy 02.12.2013
The Nordic Energy Infrastructure is Gaining Interest Askja Energy 09.12.2013
UK’s Electricity Strike Prices Positive for IceLink Askja Energy 18.11.2013
Iceland Offers Unique Renewable Opportunities  Askja Energy  11.11.2013
What do you know about the IceLink project? Arnar Pálsson 05.11.2013
Successful Energy Summit in London  Askja Energy 04.11.2013
Icelandic Energy Summit, London, November 1st 2013 Askja Energy  28.10.2013
Premature Story in the Guardian  Askja Energy 28.10.2013
1 GW Iceland-UK Electric Subsea Cable May be Close Askja Energy 07.10.2013
Significant Milestone Reached on HVDC Cable Askja Energy 12.08.2013
Iceland Seeks Second Power Cable Study to Tap European Markets Bloomberg 15.07.2013
Iceland Looks to Export Power Bubbling From Below New York Times 20.02.2013