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Landsvirkjun is developing two power projects concurrently for the first time in its history: The expansion of the Búrfell Hydropower Station and the Þeistareykir Geothermal Power Station. The objective of these new power projects is to answer the increased demand for Icelandic renewable energy.

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The expansion of the Búrfell Hydropower Station

Maximising the utilisation of the Þjórsá River

Estimates show that 14% of the utilisable water flow runs past the Búrfell Hydropower Station on an annual basis. The expansion of the station would improve the utilisation of the resource. This is in keeping with Landsvirkjun’s role, which is to maximise the potential yield and value of the natural resources it has been entrusted with, in a sustainable, responsible and efficient manner.

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A newly constructed tailrace canal, seen on the right side of the picture, runs into the Fossá river, below Búrfell Hydropower Station.

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Expansion does not require an Environmental Impact assessment 

Landsvirkjun announced its decision to expand the Búrfell Hydropower Station to the Icelandic National Planning Agency in 2013. The Agency concluded that anything up to a 140 MW station would not be likely to have a significant environmental impact and would not require an environmental impact assessment (EIA). The Project does not require an EIA as it is an expansion of the current Búrfell Station and does not fall under the requirements set out by the Master Plan for Hydro and Geothermal Energy Resources.

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Underground power house

An emphasis on placed on designing structures that are as inconspicuous as possible. The most prominent features will be the headrace canal, tailrace canal and the intake structure for the power station. The powerhouse will be located underground at Sámsstaðaklif.

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In this three-dimensional image can be seen inside the mountain, where the power station will be underground .

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Increased energy capacity and more flexibility

The installed capacity of the new power station is expected to be 100 MW (one turbine) but there are plans to expand the station by a further 40 MW. The expansion could increase the generation capacity of the electricity system by anything up to 300 GWh/Yr.

Electricity demands are expected to increase between 2016 and 2020. This predicted increase includes the demands of new customers as well as increased demand from current customers. The expansion offers increased flexibility in operations and the option of carrying out maintenance work at the current station without significant reductions to the energy supply.

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150 people involved on-site during construction

A contract was signed with Verkís Consulting Engineers for the design of the power station. Construction work on the proposed project is expected to begin in the spring of 2016, continuing until the middle of 2018. As many as 100 employees will be involved in work carried out on-site during the second half of 2016 and 150 employees are expected to be on-site throughout 2017 and during the first half of 2018.

The projected total cost of the project is 14- 16 billion ISK. The expansion is expected to begin operations in the spring of 2018.

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Þeistareykir Geothermal Power Station

The geothermal area by Þeistareykir offers extensive opportunities for geothermal utilisation and the estimated power generation capacity for the area is approx. 200 MW.

The 90 MW Þeistareykir geothermal project will be executed in two 45 MW phases, marking an initial step in geothermal utilisation in the northeast of Iceland. According to the project schedule, the first phase of the project will be completed by the end of the autumn of 2017. A particular emphasis will be placed on environmental matters both during the construction and operational phase.

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Construction underway

Landsvirkjun signed a contract in February, 2015 for the purchase of a 45 MW power generating unit and cold end equipment. The contract marked the beginning of construction for the first phase of the project. Contracts for the construction of the powerhouse and steam pipelines were subsequently completed. The second phase of the project, pertaining to the purchase and installation of a second 45 MW turbine, was initiated in August. The decision to initiate the second phase was accompanied by the subsequent decision to extract more steam and the need to modify the scope of work contracts.

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Þeistareykir - careful preparation and research

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Years of research

The first exploratory wells were drilled at Þeistareykir in 1999. Extensive research has been conducted in the proposed construction area since then as well as preparation work. Preparation measures include the construction of an access road from Húsavík, groundwork on the powerhouse site, the construction of water utilities and the development of the necessary infrastructure within the area. The project schedule includes the construction of a powerhouse, including a facilities building and workshop, as well as two turbine halls. A steam separator station, re-injection system and pumping station for the cold water supply will also be constructed as well as steam pipelines connecting the three current drilling areas.

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Construction 2015

Construction began in the middle of May when LNS Saga, the contractor hired by Landsvirkjun to construct the powerhouse and steam supply system, began construction work on facilities at Þeistareykir. Over 100 employees, hired by LNS, were working at Þeistareykir over the summer period.

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Construction of the powerhouse

The most important project of the year was the construction of the powerhouse. Construction work has been successful and concrete work on the main section of the powerhouse (connecting the building and services base) was completed by year-end. The contractor also completed work on steel frames above the turbine halls and a rough workstation. The success this year can be attributed to the professional skills of the contractors on site as well as favourable weather conditions.

Key issues:

  • 90 MW geothermal power station built in two phases
  • Construction started February 2015
  • Emphasis on environmental affairs
  • First turbine to produce electricity in fall 2017
  • Second turbine to produce electricity spring 2018
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Steam supply system

Construction work on the steam supply system began during the summer but progressed at a slower rate than initially expected. However, by late summer, an emphasis was placed on completing this component of the project. This was facilitated by providing more equipment, increasing employee numbers and implementing 24 hour long shifts. The project was well underway by mid- November and the objectives for the year were fulfilled.

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Road construction

Construction work on the Þeistareykir Road continued during the summer. Construction work on the base layer and surface coating was completed on an 18 km section of the road, from Höskuldsvatn and up to Tjarnarás by the Þeistareykir Geothermal Power Station. A double surface coating was completed as well as road marking and road markers. Construction work was completed in September and the section of the Þeistareykir Road from Húsavík to Þeistareykir is now complete.

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Design and manufacture of production equipment

Design work on mechanical equipment began in the spring, followed by the manufacture of the main components of the turbines. Contracts were then completed for steam separators and control equipment. Contracts for transformers and electrical equipment were completed by the end of the year.

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Steam extraction

Landsvirkjun was involved in a number of projects pertaining to steam extraction at Þeistareykir this year. The most extensive project was well testing in the geothermal area which was completed by the beginning of the summer. The tests showed that the steam supply from the current production wells would be enough to supply the first phase of the power project. The results also showed that the wells produced more quantities of steam than they had in previous tests.

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A commitment to safety

Landsvirkjun is committed to ensuring safety in all its construction projects and in the operation of its stations. Landsvirkjun has implemented a so-called zero- tolerance policy at Þeistareykir. The policy aims to create an accident- free workplace via an active safety system, supervision and training.

All new employees at the Þeistareykir site are expected to attend a course on safety and environmental matters. A total of 283 employees attended the course in 2015 (117 foreign employees and 166 local employees).

In 2015, Þeistareykir achieved a total of 150,000 work hours without any accident related absences.

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Extensive work on environmental matters

The unique nature of the area was considered during the execution of all preparation work and construction work at the Þeistareykir Geothermal Power Station and an emphasis was placed on environmental matters. Previously, the area was virtually untouched, with the exception of archaeological artefacts and traces of sulphur mining from previous centuries.

The regular monitoring of environmental aspects has already begun in Þeistareykir and its surrounding environment. These measures will help Landsvirkjun to monitor any effects of geothermal utilisation on the environment.

Visual aspects have also been considered during the design process for the power station and landscaping and finishing work is therefore completed alongside construction work. Examples of this include sowing on road verges and the utilisation of vegetation cover extracted from construction areas to vegetate the roadside and to cover earthen berms. Re-vegetation measures are also underway to reclaim land used for the project.

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Sustainability project

In 2015, the sustainability project in the north of Iceland was revived in cooperation with the local municipalities. The steering committee included representatives from the University of Akureyri Research Centre, Landsnet and stakeholder groups from the tourism industry. The project has also been presented to representatives from the PCC.

The Húsavík Academic Center (HAC) was asked to oversee the project. The first step will be the development of sustainability indicators to monitor any changes to society, the economy and the environment in connection with the power project at Þeistareykir, industrial construction projects at Bakki and increased tourism in the area.

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Dialogue with society

An open consultative meeting was held by Landsvirkjun and the tourist associations in Ýdalir on the 13th of January in 2015. This work was continued with a second meeting at Þeistareykir in June. Open briefing meetings were held in Húsavík and in the Þingeyjarsveit Municipality and various other consultative meetings were held throughout the year.