Final energy consumption

Iceland’s energy consumption has been rising, with forecasts suggesting a potential 28% increase by 2030. This growth is driven by higher electricity demand and increased energy use for heating, almost all of which comes from renewable sources like geothermal and hydropower. Despite Iceland’s heavy reliance on renewables, fossil fuels – mainly oil and coal – are still necessary in key sectors such as transport and fisheries. This reliance on imported fuels has slowed the overall reduction in non-renewable energy consumption.

Historically, Iceland’s energy consumption has shifted due to industrial expansion and a focus on renewable energy. However, this progress is challenged by rising energy demand, spurred by factors such as population growth and the growth of energy-intensive industries like aluminium smelting. While renewable energy usage continues to grow, the increasing demand for energy makes further reductions in fossil fuel reliance difficult. Without significant policy changes or technological advancements, Iceland’s energy consumption is expected to keep rising, complicating future sustainability efforts.