“Why would you build a power plant so close to such a great spa facility?” This is frequently the first question people ask when visiting Iceland’s Blue Lagoon. This is a valid question, and there is a very logical reason for the location of Blue Lagoon, one of the 25 wonders of the world, according to National Geographic.
Rather ironically, the Blue Lagoon is the result of an environmental accident formed during the installation and operation of the Svartsengi geothermal power plant in 1976. The spill created a surreal pool of blue water, geothermal seawater, near the plant and people started to bath in the water. Over the years, word spread of the healing effects of the lagoon’s water, particularly for people with skin ailments such as psoriasis. What was once a small changing room shack and dusty parking lot for locals has been built into a profitable company that employs 240 people year round. The Blue Lagoon attracts more than 600,000 visitors per year. In addition to becoming a world renowned spa, Blue Lagoon operates a special clinic for psoriasis treatments. The company develops and markets Blue Lagoon skin care line based on the geothermal seawater and its active ingredients, minerals, silica and algae.
Not surprisingly, there are many other projects around the world that wish to duplicate the success of Iceland’s Blue Lagoon. Indeed, the Blue Lagoon has become an inspirational and profitable “side business” for geothermal operations around the world.
Currently, there are promising projects in various states of development in Africa and Asia. Kenya’s state-owned electricity producer has been building a large natural health spa near its Olkaria geothermal fields in Hellsgate National Park near Naivasha. The spa consists of four interconnected lagoons, a sauna, and a steam bath. Another project in Oriental Mindoro in the Philippines is developing a geothermal spa that will be part of a resort planned for the island. Both explicitly mention Iceland’s Blue Lagoon as a business model and plan to replicate its success.
Clearly the Blue Lagoon is business model that geothermal producers around the world would like to duplicate. However, how did an environmental accident from the mid 1970’s in rural Iceland become so successful? What were the steps and people behind this transformation that has become an inspiration for those in Kenya and the Philippines?
The power plant operator HS Orka (formerly Hitaveita Sudurnesja) has been a key investor in the Blue Lagoon from the beginning, and also the provider of the water for the lagoon and its operations. The main inspiration and drive for this transformation has been though Grimur Saemundsen, the CEO of the Blue Lagoon. As an entrepreneur, he founded the Blue Lagoon with a vision to build a first class wellness facility. Saemundsen is a medical doctor by profession, and the healing effects of the Blue Lagoon motivated his interest in the lagoon and laid the foundation for the business that it is today.
From the very beginning, Saemundsen and his team placed a strong emphasis on architecture and design when planning the Blue Lagoon. The main focus was to blend the facility in with the natural environment of the surrounding lava fields, providing harmony between nature and the man made facilities. Local architect Sigridur Sigthorsdottir of Basalt Arkitekt was hired. She is responsible for the architecture of several other unique spa operations in Iceland. The importance of branding and marketing was an important consideration from the beginning. Icelandic designer Sigurdur Thorsteinsson of Design Italia was hired to manage the emergence of Blue Lagoon as a brand. It is clear that design and architecture has always been at the forefront of the business model for the company.
This naturally is a lot to manage, but the company has taken important steps in protecting the unique experience of visitors to these seemingly otherworldly waters. The availability of online booking helps to manage peak times in the summer, while still catering to guests and providing a once in a lifetime lagoon experience. With increasing year round tourism in Iceland, the winter season has seen more and more guests experiencing the unique nature and beneficial effects of the lagoon’s geothermal seawater.
Today, the Blue Lagoon is perhaps one of the strongest Icelandic brands, and is synonymous with the very concept of how a geothermal spa should be. Furthermore, Blue Lagoon has created a strong brand name recognition and reputation in health, wellness, and beauty with its skin care products. The skin care product line is based on Blue Lagoon geothermal seawater and its ingredients; minerals, silica and algae harvested with green and sustainable methods in Blue Lagoon R&D and Harvesting Center in Svartsengi at its resource park.
The healing effect on psoriasis has been scientifically proven. Studies conducted in cooperation with professor Jean Krutmann at the Heinrich Heine Institute in Germany show that the Blue Lagoon algae have anti-aging effects and that the Blue Lagoon silica strengthens the skin barrier function. The algae, exclusively used in Blue Lagoon skin care is grown at the R&D center using CO2 (effluent gas) from the HS Orka power plant, which signifies a step to reduce the plant’s carbon footprint. Silica for use at Blue Lagoon spa, clinic and as a part of the skin care product line is also produced at the center. The sustainable and multiple uses of the byproducts from this geothermal resource have been guiding principals for the company..
The first skin care products were produced and designed with the specific needs of people struggling with psoriasis. Blue Lagoon Silica mud mask was among the first of the products developed and it is still one of the company’s most popular. Blue Lagoon now offers a complete line of skin care products that cleanse, boost and nourish skin, including a highly researched and developed anti-aging facial skin care line. Blue Lagoon operates three specialty Blue Lagoon skin care shops in Iceland, one at Keflavík International Airport, another in Reykjavík city center, and at the Blue Lagoon. The skin care range is also sold worldwide through the online shop on www.bluelagoon.com.
The Blue Lagoon also operates a clinic where specific psoriasis treatment is provided. The clinic has fifteen well-appointed and designed hotel rooms. Future plans are in the works to expand the Blue Lagoon spa experience area and construct a new sixty-three room hotel.
In speaking with Magnea Gudmundsdottir, the company’s Director of public relations, we asked how replicable is the success of the Blue Lagoon? “Blue Lagoon is very unique. It is based on the geothermal seawater that is only found in this location. Thus, Blue Lagoon cannot be replicated in other parts of the world. Hopefully, it can serve as an inspiration to fully use the geothermal resources as we do at Blue Lagoon, located in the Svartsengi resource park.” When asked what advise she would give to other geothermal spa developers, Gudmundsdottir says that it is important to, “Stay true to their vision and build on what is unique for their site.”
The Blue Lagoon also cooperates with other geothermal spas in Iceland, including Nature Baths in Mývatn and Fontana in Laugarvatn.
The Blue Lagoon is open year round and located on the Reykjanes peninsula in the municipality of Grindavik, approximately a 20 minute drive away from Iceland’s international airport and about a 45 minute drive from the capital, Reykjavik. More details on www.bluelagoon.com
This article was published in the Think GEOENERGY Magazine Issue 2 in May 2014 and re-issued here with permission.
Lead image: Blue Lagoon with Svartsengi geothermal power plant in the background, Iceland. Credit: Vestman, (c) CC BY 2.0.
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