Ölfus and Reykjavík Geothermal explore new hot-water project

Ölfus municipality is preparing to work with energy company Reykjavík Geothermal to assess a possible heating project aimed at improving access to hot water for residents and businesses. Morgunblaðið reported that the municipal council approved a letter of intent last week.

The parties will examine supply and demand, financial viability, technical requirements and possible locations. One option is a standalone project near Þorlákshöfn with installed thermal capacity below 50 megawatt-hours. Another is to link the project to Reykjavík Geothermal’s work at Bolaalda.

Mayor Elliði Vignisson told Morgunblaðið that demand for energy around Þorlákshöfn is expected to grow in the coming years. He cited further expansion of aquaculture and fish farming, large-scale greenhouses and other energy-intensive businesses.

“Current access to hot water is not sufficient,” Vignisson said. He said the municipality had established the energy company Títan and was looking for partners to explore further energy production near Þorlákshöfn.

Ölfus works with Veitur, which holds an exclusive licence for heating residential buildings but has no obligations to the business sector, Vignisson said. He added that energy exploration in the Þrengslin area, near Bolaalda and elsewhere looked promising.

The letter of intent will remain in effect for up to 24 months and is not a binding agreement to carry out the project. The municipality’s mayor will lead further discussions, with findings and proposals for any subsequent agreements to be presented to the council.