Alcoa & Iceland Study Geothermal-Powered Smelter for North Iceland

Reykjavik, Iceland & New York [RenewableEnergyAccess.com] Alcoa and the Government of Iceland will begin feasibility studies for the development of a 250,000 metric ton per year (mtpy) aluminum smelter to run principally on geothermal energy, at Bakki near Husavik in North Iceland.

The selection of this site to conduct studies on was based on extensive research of three sites. It is the first time that such an exhaustive public comparative analysis has been conducted for industrial site selection in Iceland. Should the feasibility studies prove the viability of the proposed smelter, ground may not be broken until 2010. Alcoa’s final assessment took into account economic, social, and environmental factors covering site geology and topography, climate, coastal marine conditions, harbor facilities, transportation, power supply, community demographics, community acceptance, labor market, employment potential, aesthetics, archaeological importance, ecology, and other factors. In announcing Bakki as the site chosen for further, detailed studies, Valgerdur Sverrisdottir, Minister for Industry and Commerce, Iceland, said the establishment of an aluminum smelter based on renewable hydro or geothermal energy in North Iceland was an essential element in the government’s economic development strategy. “It is essential that we use our clean and renewable energy sources to broaden and strengthen our economy through regional industrial development that will deliver stable, long-term, sustainable benefits. Aluminum smelting is an ideal industry for this purpose. We have seen the benefits that have flowed from such development in the south and west. Alcoa’s Fjardaal smelter, which is currently under construction, is stimulating renewal in East Iceland. And now we need to seek similar development for the North,” Ms. Sverrisdottir said. “This is not yet a decision to build a smelter,” said Bernt Reitan, Executive Vice President Alcoa, and President Alcoa Global Primary Products. “This could conceivably be one of the first geothermal-powered smelters in the world, so we have a great deal of work ahead of us to prove the feasibility of this project — particularly around the cost, and timing of delivery, of power — but this is an outstanding opportunity to continue building our successful relationship with the Government and people of Iceland.” Reitan spoke to Iceland’s receptivity of the studies in general: “It is a country where Alcoa’s commitment to sustainable development is expected and embraced, the business environment is supportive and transparent, the Regional authorities welcome responsible development, and the workforce is highly educated and skilled in a wide variety of disciplines. We feel very much at home here.”