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Hafnarfjörður and HS Orka reach an agreement on Krýsuvík


The municipality of Hafnarfjörður and HS Orka have signed an agreement on research and utilisation of resources in Krýsuvík, for the production of hot water, fresh water and electricity. The goal is to secure the supply of hot water to Hafnarfjörður and elsewhere in the capital area, as well as meet the growing electricity demand in the country. Ideation for a resource park with an emphasis on outdoor activities, eco-friendly tourism and sustainable economic activities will be worked on simultaneously.

The future development of district heating in the capital area

The municipality of Hafnarfjörður and HS Orka have signed an agreement on authorisation for research, land use, lease of land and the utilisation of resource rights in Krýsuvík. The aim of the agreement is to explore the possibilities of harnessing geothermal energy and extracting groundwater on the land of Krýsuvík in a cost-effective and environmentally friendly manner, in parallel with the development of a resource park where further utilisation of production streams takes place. The aim is for a geothermal plant to rise at Sveifluháls in the Krýsuvík area.

The agreement provides authorization for research on groundwater resources, geothermal energy and the feasibility of water and energy production on the land of Krýsuvík. On the other hand, the agreement provides authorisation for utilisation of resources as permitted by utilisation licences and the projects feasibility. The agreement, which is based on a letter of intent from November 2022, was approved by the town council of Hafnarfjörður last week, on the 5th of June.

Krýsuvík is a part of Hafnarfjörður and is a valuable outdoor recreational area and a popular tourist destination. Krýsuvík also has one of the most promising options available for the future development of district heating in the capital area. With the utilisation of resources in Krýsuvík, a stable supply of hot water to the capital area could be greatly improved, as the capital area now receives all it´s hot water from areas located east of the area, i.e. from the Nesjavellir Power Plant and the Hellisheiði Geothermal Power Plant.

An important milestone for Hafnarfjörður

Rósa Guðbjartsdóttir, mayor of Hafnarfjörður, says that it is an important milestone for Hafnarfjörður that an agreement has been reached on the future development at Krýsuvík. “The Krýsuvík area is a unique treasure owned by Hafnarfjörður that offers great and untapped opportunities to use and enjoy. This research and utilisation agreement has been in the making for quite some time. The aim of the project is to ensure that the people of Hafnarfjörður and others have access to hot water and energy in the future. At the same time, the area will be made more accessible for outdoor activities and enjoying views of nature.”

Tómas Már Sigurðsson, CEO of HS Orka, says that the agreement with the town of Hafnarfjörður is a great cause for celebration. “It lays the foundation for further geothermal research in the Krýsuvík area. We are hopeful that the research will lead to geothermal energy being used equally for the production of hot water for the people of Hafnarfjörður and its neighbours, as well as for the production of electricity. Along with possible energy production, exciting new opportunities will be created for the development of various eco friendly economic activities in Krýsuvík.”

Role model in the interplay of energy production, tourism and nature

It is estimated that a new geothermal plant in Krýsuvík could heat up to 50,000 people as well as have a power capacity for electricity production of up to 100 MW. The aim is also to work on ideas for a resource park in Krýsuvík with an emphasis on the development of environmentally friendly tourism that fits well with the environment and nature, facilities for outdoor activities as well as eco friendly economic activities, such as algae cultivation, natural chemical processing and cultivation in greenhouses. Emphasis will be placed on ensuring that the use of materials, textures and colours of all the structures in the area fit well with the environment and that the uniqueness of the area is preserved and allowed to flourish. In total, the leased area is about 200,000 square meters and the geothermal area about two square kilometers.

Fourfold benefits

The benefits of the agreement are therefore fourfold: Increased energy and hot water security for the capital area and especially Hafnarfjörður. Development of infrastructure that attracts service providers and visitors to the area. Diverse opportunities for the development of economic activity in the spirit of the circular economy, which can become a model in the interplay of energy production, tourism and nature.

HS Orka hf. owns and operates two geothermal power stations in Reykjanes and has for half a century built up knowledge and experience in the field of diverse utilisations of resource streams from power plants. In HS Orka’s Resource Park, the streams are utilised for green energy solutions, cultivation, farming and the food industry, as well as tourism. HS Orka produces electricity for the country’s main transmission system as well as supplying the community in Suðurnes with fresh water and hot water.

An introductory meeting on the plans will be held at 5 p.m., Wednesday, June 12th in Bæjarbíó, see event in Icelandic here.

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