Geothermal Economic Impact Data Base
- 09-02-017
Coordinator: Sveinn Agnarsson, University of Iceland
Project finished in 2013

Total project cost

ISK 11.9 M


ISK 5.3 M





MSC students


BSC students


The first stage of the project consisted of compiling and collecting data on the utilization of geothermal resources from the National Energy Authority (NEA) for the period
1994-2009. This includes information on number of consumers, technical issues, total revenue and sales to individual sectors and households.
The second stage consisted of assembling national input-output (I-O) accounts which detail the flows of inputs and outputs in production within an economy. A simple 2×2 model, with two sectors – geothermal and other sectors – was constructed and the model was then used to analyse the effects of changes in the factor tax rate (capital and labour), as well as increases in each of the value-added tax rates. More complex 9×9 (with nine sectors) input-output tables were also developed where the energy sector was split, a little arbitrarily perhaps, into a geothermal sector, an electrical energy sector and a hydropower sector.

These tables were then used to calculate impact multipliers that describe how changes in demand for one sector affect the rest of the economy.
The third and final stage of the project consisted of mapping how Icelandic firms use geothermal energy in their production process. In all, 72 Icelandic firms were found to employ geothermal energy as an input, of which 32 were in horticulture and other greenhouse activities and 24 in aquaculture. A survey was then undertaken to establish how important the geothermal input is for the operation of the firms, and to what extent proximity to geothermal energy sources was a deciding factor in deciding where to locate the firm.




Final report 2015

District heating operations in Iceland. Profability and natural monopoly. Rekstur hitaveitna á Íslandi. Arðsemi og náttúruleg einokun; Sæmundsson, P.K. (2012); University of Iceland, Master’s thesis

The GEOEQ Model. A simple computational general equilibrium model for the Icelandic geothermal sector; Guðmundsson, G.S., University of Iceland, Report.

Input- output Tables and Multipliers (2012); Institute of Economic Studies

Geothermal Economic Impact Data Base; Agnarsson, S. (2012); GEORG Geothermal Research Group, Open house, Report

Business Use of Geothermal Energy; Agnarsson, S. (2015); GEORG Geothermal Research Group, Open house, Report

Mikilvægi beinnar jarðhitanýtingar í atvinnustarfsemi á Íslandi [Business use of Geothermal Energy] (2013); Ragnarsson, Ö.P.; Institute of Economic Studies

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