MY older brother has been living out in Reykjavik for the last almost four years and I went out to visit him a couple of weeks ago. When I tell people that he lives there, it’s usually met with commentary along the lines of “what a niche place to move to”. While it might not be as typical a choice as the likes of somewhere like the favoured choice of sunny Sydney, my recent trip to Iceland affirmed to me why, even if niche, it’s an impeccable choice for those considering emigration.
Some of its main selling points are its geothermal and hydropower energy systems, which heat and power the entire country for pennies using its own natural resources.
What a concept!
Iceland is a golden example of how claiming your independence is the key to your exponential economic growth and success.
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Having divorced the Danish state to become a fully independent republic in June 1944, the Icelanders are a solid reference point for independence supporters in Scotland – but I don’t think their success, and how it was singularly driven by the acquisition of their independence, is leaned on enough when we discuss the prospect of our own.
Their energy system alone is one of the biggest independence success stories of all time. Iceland and Scotland might differ in that we hardly have masses of geothermal potential at our disposal, but we do have our own unique energy potential in abundance, and how they have both capitalised on and utilised theirs for the benefit of their own economy is a lesson worth paying attention to.
Sitting on the Mid-Atlantic Ridge (or, in other words, on the edge of two tectonic plates pulling in opposite directions), magma is unusually close to Iceland’s surface.
By tapping into that natural heat source and using steam superheated by magma to spin electricity turbines at power plants like Hellisheidi, around a quarter of Iceland’s electricity is generated exclusively by this limitless renewable loop.
Once the steam from the turbines cools down, the water is simply pumped back underground where it meets the magma to be reheated and the cycle starts again.
Though geothermal accounts for around a quarter of electricity generation, hydropower makes up most of the remainder. It means that Iceland’s entire domestic energy system relies on the basics of geology rather than the ugly combustion of fossil fuels to sustain itself.
The same geothermal reservoirs are used to provide the country’s heating system. My brother lives in a quirky but enormous top-floor flat in the heart of Reykjavik. It sits in prime position atop a slight slope, with views over Hallgrimskirkja and a unique exposure to the infamous Icelandic elements.
Having been built decades ago, it’s more like the size of a house, and has both large windows in every room and a balcony door in the primary bedroom. Its front door is, unusually for a flat, made of glass and looks more like an internal door.
In a country where temperatures often comfortably sit below freezing in the winter months and the wind is so powerful the Icelandic language has 156 different words to describe it, a sound heating system is a necessity for a flat of its kind.
What is often an anxiety-inducing thought for those of us in Scotland at the mercy of Westminster’s energy shackles, heating supply for the locals in Reykjavik is a non-issue.
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My brother’s heating policy is “it stays on full time, if it gets too hot, we open a window”.
Here’s the real kicker – his monthly heating bill costs an average of 1145 Icelandic krona, which equates to roughly £7. Around 90% of Icelandic homes are heated directly by geothermal hot water.
Not using electricity, but through district heating systems where hot water from geothermal reservoirs travels through insulated pipes and straight into radiators and taps.
An absolute masterclass in green self-reliance.
The green debate is less a debate for Icelanders than it is a way of life. Geothermal energy is considered renewable because the heat source, being the Earth’s internal energy, is effectively inexhaustible on human timescales.
Emissions are dramatically lower than from fossil fuels, though not zero, owing to the slight CO2 and sulphur emissions it generates.
But compared to typical energy systems, the difference is night and day, and Iceland aims to reach carbon neutrality by 2040.
While the rest of us endlessly debate about the necessity of green energy, Iceland has been operating on a low-emissions model for decades.
That’s not to gloss over the geological advantages at their disposal; not every country has an easily accessible supply of magma, most don’t.
But it is a prime example of how to utilise the resources you do have for your own benefit, and resources are something that Scotland has in abundance in the form of wave, solar and tidal.
While we don’t quite have magma bubbling conveniently below the streets of Edinburgh, the resources we do have have the potential to exclusively power 100% of Scotland’s domestic energy consumption – and then some.
Whitelee Wind Farm alone has a generating capacity sufficient to power around 350,000 homes, yet we still have some of the highest energy prices in Europe because key levers like grid regulation and market pricing remain in the Westminster chokehold.
What's perhaps most impressive about this for me isn’t how Iceland uses this to power and heat themselves domestically, but how they use their energy potential to grow economically, a feat only possible because they are an independent nation making decisions in their own best interests.
For example, Landsvirkjun, Iceland’s own national energy company, contributes up to $195 million (£150m) a year in dividends directly to the Icelandic treasury, making it one of the country’s major sources of revenue, which is in turn reinvested back into its people. Is it any wonder that it’s one of the happiest, safest countries on earth?
If they can teach us anything, it’s that political power is the decider in energy strategy. Iceland used its geological good fortune to build domestic resilience after the 1970s oil crash.
In a similar fashion, Norway used its oil resources to build intergenerational wealth with its sovereign wealth fund that generated $247 billion (£185bn) in 2025.
Both outcomes were directly attributable to the fact that they are sovereign, independent nations that make decisions for themselves and for their own benefit.
For Scotland, while our geological advantages are in abundance, strategic control remains dominated by Westminster policy that continually strangles our potential.
While we siphon any potential sovereign wealth fund south of the Border without so much as a first sniff and stay stuck in a system designed to shaft us domestically and on the global stage, the small independent nations of the Nordics are investing in infrastructure that not only protects them domestically, but that insulates their success in a global market currently out of control.
Much more of this and I might just be tempted to join my brother in the geothermal, sulphur-scented paradise of Reykjavik.
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