Isolated rural ag business in Iceland

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REYKJAVIK, Iceland—Agricultural related industry located in the rural lava fields of Iceland was on the agenda for touring on March 7. The fish hatchery that grows tons of Arctic charr fish and the greenhouse for growing genetically modified barley as a complex protein media for use in medical research were two major exploratory stops for North American and European journalists.

The morning began with attendance of the Iceland Geothermal Conference in Reykjavik before traveling to the countryside for the afternoon. Jay Natwani, U.S. Department of Energy, provided an explanation to the conference of the U.S. government’s incentives for development of geothermal energy.

He outlined several financial incentive programs of grants, loans and awards. His contention is that geothermal is a high risk program in the initial stages of development, and many companies are not able to receive investor or bank money to proceed. Because geothermal development as a renewable fuel is in the public’s interest, U.S. government money should be invested just as U.S. money is invested in grain ethanol, cellulosic ethanol, wind energy or biodiesel.

“Geothermal development looks flat today, but we are developing a technology base; we are providing incentives. If we can solve, now, the next technology hurdle of EGS (enhanced geothermal systems), our future is really bright,” said Natwani.

He noted one area of interest is the hot water being a co-product of oil wells. “In the United States, there are thousands and thousands of oil and gas wells. According to EGS, each and every gallon of oil we produce there are 10 gallons of hot or warm water produced from those wells,” he said.

Researchers are hard at work demonstrating and developing technology for use of this “low temperature geothermal resource” for generating electricity. He mentioned a project in Alaska where 165 degree Fahrenheit water has been used in a demonstration to produce electricity.

Also on the program with Natwani was Gunnar Tryggvason with KMPG mainly talking about the potential for Iceland earning a high income by exporting its energy to Europe via connector cables at the bottom of the ocean.

In his presentation, a comment repeated by more than one Icelander who spoke to me, related to the government’s official policy: “Iceland’s energy needs will be met in a sustainable way, for the benefit of the people and society.” The comment was, “whatever that really means.”

That comment is exactly what is said by people of the U.S. and especially farmers and ranchers when the word sustainable is included in some official U.S. policy or company standards—“whatever that really means.”

As for connectors to Europe, which could use Iceland’s low-cost electricity, Tryggvason said Iceland could produce five times its own market needs. Although not mentioned by Tryggvason, it is a contention by many that Iceland should encourage investment by industries with high-use energy needs to locate in the country, rather than exporting the energy. Which one is sustainably beneficial to the people of Iceland?

The afternoon visits began with a tour of a fish hatchery/farm owned by Samherji HF, which has three big fish farms in Iceland and is a major fish producer in Scandanavia. The operation visited takes advantage of being in a geothermal lava field for its heated water and electricity to raise Arctic charr. These fish in the wild live in sea water only about three months out of the year and the rest of their reproduction cycle in fresh river water.

The charr produced in Iceland is exported with 40 percent to Europe and 60 percent to the United States. “It is the most common fish in Iceland,” said Teitur Amlaugsson, the hatchery manager.

A connection with university fishery operations is the source of the eggs for the fish hatchery, which originally were native stock from Iceland rivers. The charr take 24 months to develop from eggs to marketable fish—12 months in the hatchery and 12 months in open-air tanks. The fish farm grows four hatchings of charr per year.

The next stop was Orf Genetics. One of the founders, Einar Mätylä, Ph.D., explained the concept of protein production using plants, and in the case of Orf Genetics, 45 different proteins from growing genetically modified barley.

A 2,000 square meter greenhouse was in an isolated portion of the lava field near a geothermal electric plant. The greenhouse is hot water heated and lit with geothermal generated electricity. Seedlings are planted in pots at one end of the greenhouse and automatically transferred from one end to the other during a 2 ½ to three-month period with harvest of the seed heads by hand. The company has an additional 4,000 square meters of greenhouse operations on the island to meet current demand, and they are looking to expand.

Besides media for laboratory research, including human cancer, protein products from Orf Genetics are being marketed in skin care products.

Mäntylä explained how hard it was to gain funding for such a company in the beginning, but the company has increased 20 times its startup position. “But we are here and the banks aren’t,” he said in reference to the collapse of the banking industry in Iceland in 2008. He said, “We deliver with meager means.” 

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