• 4 minute Hey Oil Bulls - How Long Till Increasing Oil Prices and Strengthening Dollar Start Killing Demand in Developing Countries?
  • 8 minutes Could oil demand collapse rapidly? Yup, sure could.
  • 15 minutes Oil prices going down
  • 50 mins Oil prices going down
  • 17 mins Could oil demand collapse rapidly? Yup, sure could.
  • 1 hour Migrants: Italy Wants EU Border Agency In Africa, Not At Sea
  • 5 hours Sabotage at Tesla
  • 13 hours Oil and Trade War
  • 25 mins Trump Hits China With Tariffs On $50 Billion Of Goods
  • 12 hours Germany Orders Daimler to Recall 774,000 Diesel Cars in Europe
  • 15 hours Sell out now or hold on?
  • 15 hours Russia and Saudi Arabia to have a chat on oil during FIFA World Cup - report
  • 1 hour After Three Decade Macedonia End Dispute With Greece, new name: the Republic of Northern Macedonia
  • 10 hours What If Canada Had Wind and Not Oilsands?
  • 9 hours The Wonderful U.S. Oil Trade Deficit with Canada
  • 1 hour The Irrelevance Of BTU Rating - Big Oil's Gimmick To Hoodwink The Public
  • 1 hour Nopec Sherman act legislation
  • 13 hours venezuala oil crisis
  • 13 hours When will oil demand start declining due to EVs?

Breaking News:

Nigeria Struggles To Sell Its Crude

Can U.S. Shale And OPEC Find Common Ground?

Can U.S. Shale And OPEC Find Common Ground?

OPEC and U.S. shale have…

The Next Stage In Perovskite Solar Development

The Next Stage In Perovskite Solar Development

Perovskite photovoltaic cells have long…

UK to Finance Subsea Energy Cable to Connect Grid with Iceland

The Guardian has written that it expects Iceland’s president Olafur Grimsson to this week ask the British government to hand over the finances necessary to begin construction of the £4.3 billion subsea electrical cable that will link the two country’s energy grids, providing the UK with a source of clean, cheap energy.

Iceland has the cheapest electricity prices in Europe thanks to its abundant sources of geothermal, hydropower, and wind energy. It produces over 12 gigawatt-hours of energy, which is nearly five times the demand of the islands tiny population of 317,000 people.

geothermal power plant in Iceland.
A geothermal power plant in Iceland.

Landsvirkjun, the state-owned electricity company, said that this over-supply in the market will allow Iceland to deliver five terawatt-hours of electricity a year to the UK via the world’s longest subsea interconnector cable, and at a cost 15% lower than the price of offshore wind energy. The cable will be around 1,000km long, and sit up to 1,000m below the surface of the sea, providing as much as 1.5% of the UK’s electricity demand. It will not be built until 2022.

Related article: Cameron to Cut Green Taxes in Battle over Rising Energy Prices

At the end of May 2012 the Icelandic and British governments signed a Memorandum of Understanding to join the two energy grids via an interconnector cable, but before the contract can be put out to tender the British government must stump up the funds to cover the huge costs of the mammoth infrastructure project.

For years Iceland made use of its huge energy over-supply by encouraging power-intensive industries, such as aluminium production (with Rio Tinto, and Alcoa), to set up plants and take advantage of the cheap energy. Just a few large aluminium processing plants use more than 70% of all electricity generated on the island, but a recent downturn in the aluminium market has caused them to look elsewhere for customers, and the UK could provide a long term, reliable client.

Subsea energy cables in Northern Europe.
Subsea energy cables in Northern Europe.

The UK is keen to secure a reliable source of renewable energy that will nicely complement its growing offshore wind energy sector, and help its reach its renewable energy targets and reduce carbon emissions.

The Guardian suggests that the deal might help to repair relations between the two countries which were stretched thin after the 2008 Icesave scandal in which the Icelandic government refused to honour a promise to guarantee the money of hundreds of thousands of UK citizens that had been deposited in failed Icelandic bank, Landsbanki.

By. Charles Kennedy of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News