In 1969 the first of three aluminium smelters was built in Iceland at Straumsvík, near Hafnafjörður, on the South West side of Reykjavík by Alusuisse (subsequently Rio Tinto-Alcan). In 1998 a second smelter was constructed by Century Aluminum (now a subsidiary of controversial mining giant Glencore), at Hvalfjörður near Reykjavík, and in 2007 the third, run by Alcoa, was completed at Reyðarfjörður in the remotely populated East of the country. The Icelandic Government had been advertising the country’s vast ‘untapped’ hydroelectric and geothermal energy at ‘the lowest prices in Europe’ hoping to attract jobs and industry to boost Iceland’s already very wealthy but somewhat fishing dependent economy. The industry, which would permanently change Iceland’s landscape with mega-dams, heavy industry scale geothermal plants and several kilometer long factories, was promoted by the Icelandic Government and the aluminium companies as ‘good employment for a modern age’. However, ten years after the flagship Alcoa Fjarðaál project was completed, unemployment is higher than it was in 2005, and Iceland’s economy has become dependent on an industry which is vulnerable to commodity cycle slumps and mass job losses. Worse, the price charged for Iceland’s energy is tied to the price of aluminium and analyses of the country’s 2008/9 economic crisis suggest it was exacerbated by the poor terms of Iceland’s late industrialisation. Yet demands for further industrialisation remain, and more than 1000 Icelanders are employed in the aluminium sector.

This article exposes the conditions inside Iceland’s aluminium smelters based on interviews with workers conducted in 2012. The stories from two smelters share correlating accounts of being forced to work in dangerous conditions under extreme pressure, and without adequate safety equipment, leading to serious accidents which are falsely reported by the companies. These shocking allegations require serious attention by the trade unions, Icelandic government and health and safety authorities. This especially in the current context of labour disputes with the aluminium companies, alongside revelations about the same companies’ tax avoidance schemes and profiteering in the country.

Century, Grundartangi:

A former worker from the Century plant at Grundartangi shared his story, though did not want his identity revealed. Steini (not his real name) had worked at the plant for ten years and only quit recently.

“When I went to work there I thought of it as just a job and it was good pay. My experience of it was that they were taking our labour for cheap and making work us like slaves. The only thing we get out of it is our pay.

There were so many accidents that were their fault, not ours. They put so many rules in place, but you have to break the rules to get the work done, which they are pressuring you to do, then if something goes wrong its all your fault.”

Steini described how bonuses are awarded to the shift according to the number of accidents. If you have an accident and are off work you lower your annual bonus. At first the bonuses included smart new bikes, then they were reduced to a restaurant meal, and finally just pizza and beer.

He described the pressure of the job; how workers are pushed to work harder, but as soon as they get quick at the tasks they add more work so they are even more pressured. Akin to Alcoa Fjardaál in the East of Iceland the turnover rate is around 20% with only a handful of people staying for ten years as he had. Similarly, both Alcoa and Century Aluminum have gradually replaced permanent jobs with contract labour. Increasingly the work force was made up of University students on summer jobs which made the work even more risky as this short term labour was less experienced and more prone to accidents.

Shifts were twelve hours long, for 183 hours/month and the working hours were very unsociable, many at night for three days in a row. Steini described how most of the days off in between shifts were used to sleep and recover energy in order to work again. As the plant was expanded and more pots were added the work got harder.

“Everybody who works in Norðurál [Century] hates it. Most of the people are eating anti-depressants and everything. They hate the company, they hate the work but they are afraid to change and be without work.” He said.

He described how many accidents there were at the factory and how the company avoid paying compensation or having to report the severity of the incident;

“I got a broken finger, I burned my feet and once I had a forklift drop on my arm. I never got any compensation from the company and when I went to insurance companies I could get nothing either. The company ask you to come back to work as soon as you can move and just sit at the computer, then they count that as being ‘well’ in their records so it looks like less ‘work days lost’. The insurance companies also see it this way so it it very hard to get compensation.

One guy was doing something very risky and fell into the [molten aluminium] pot up to his knees. He was on morphine for a few weeks. I remember the health and safety guy coming out of a meeting with him smiling. He had admitted that it was all his own fault.”

Industry standards on reporting discriminate between lost time injuries and restricted work injuries, with the former being taken more seriously. Like Alcoa, Glencore claim that the ‘total recordable injury frequency rate’ (TRIFR) is being reduced annually. Nonetheless ten people died at Glencore’s global operations last year according to their 2015 Annual report, and sixteen in 2014.

Scandals over worker’s rights had previously erupted in Iceland during the construction of several mega power projects for the aluminium industry after the conditions of cheap foreign labour were exposed. More than a dozen Chinese and other foreign workers died during the construction of the Kárahnjúkar dam and several Romanian workers suffocated in geothermal pipes on the site of a Reykjavík Energy work camp in Hellisheiði where they worked up to 72 hour weeks.

Steini described the heat of the pot rooms and how restrictive and hot the many types of safety clothing are. As a result most workers chose to use the minimum amount of safety clothing, enabling them to be comfortable and work faster to get bonuses;

“You used as little safety equipment as you could so you could get the job done. When I was in the pot room I just used a paper mask for comfort. I stopped noticing the smell of the gases, then after a period working in the pot lining rooms I went back to the pot room and I really smelt it. It chokes your throat and you know it’s bad.”

‘Pot rooms’ are huge sealed troughs of carbon anodes and aluminium flouride through which up to 320,000 amps of electricity are passed to separate the strongly bonded oxygen from the alumina. Molten aluminium is then ‘tapped’ from the pots and cast into ‘ingots’. The process generates gases including inorganic fluorides, sulphur dioxide, CO2 and perfluorocarbons. Perfluorocarbons (PFCs) are extremely potent greenhouse gases lasting up to 50,000 years in the atmosphere. Tetrafluoromethane, the most common PFC is 6,500 times more potent a greenhouse gas than CO2 and its main global source is from aluminium smelters. Sulphur dioxide and fluoride emissions are acidic and can kill or stunt plant growth. Fluoride emissions also build up in the bones and teeth of animals and humans causing Skeletal Fluorosis, which weakens bones and can lead to bone deformation much like arthritis. Farmers living around Centrury’s smelter in Hvalfjörður claim their sheep and horses have got sick and even died from flouride poisoning.

Saga (not her real name) started work in Century Aluminum’s Grundartangi smelter in 2006, before turning twenty. It was her first big job and her introduction to the working world. She was working twelve hour shifts from the outset, and her work began in the pot rooms. Like Steini she described the fallacy of the health and safety training;

“We were told to wear dust-masks because of all the dangerous and unhealthy gases that come out of the pots, also because of the alumina, fluoride and other pollution in the air. You could always smell it all through the mask though. It was emphasized very heavily not to smoke inside because smoking inside the pot-rooms could result in ‘stone-lungs’ in few years time, which is very common amongst smelter-workers. That is because of all the pollution in there. If you would smoke inside, you were inhaling three times more tar and other stuff straight down to your lungs than if you where smoking outside in more normal surroundings. We also learnt that pregnant women are never allowed to enter the pot-rooms because there is a great risk of foetal harm.”

Saga accused Century of extremely low health and safety standards and condemned the company for making workers “repeatedly risk their lives to keep the smelter operational into the next shift”. She described being given second hand protective clothing in poor condition, and claimed that much of the equipment was in need of repair but was still being used as parts were hard to come by. Like Steini she had witnessed and experienced serious injuries, which had been misreported or disguised by asking workers to come in for office days when injured in order to improve the figures on workdays lost due to injury;

“Working for show” you could call it. I have even heard about workers with broken legs being made to show up for hanging out in the office for a few hours just to keep the records clean. It was easy to pressure people with many passive methods, such as bringing down the accident record which means that their shift doesn’t get a reward like the others that went through the year “without” accidents that caused absents.”

She gave a scathing and detailed account of the pressured and dangerous work environment;

“I witnessed others, and found myself, doing dangerous and life threatening things in the smelter. This was not because we had some kind of death wish or thirst for adrenaline but because there was no other way to finish our daily jobs on time. There is no other choice than to climb on that pot, drive that windowless forklift, work on this broken down and not really functioning crane today, not take proper breaks. Be one doing two people’s jobs, drive too fast because you have to hurry and “fixing” things with all possible and impossible ways so they will last just a little bit longer. I have seen people run away, scared for their lives, and then being forced back because somebody has to take care of what went wrong. I have witnessed what happens after a pot explodes.

Far too many people cram themselves into vehicles, because distances are very long and your main transport is your own two legs on the hard concrete floors. These are all labeled as dangerous things to do in there and in theory they are not “really” allowed. For example climbing on pots –which are very often badly closed and have broken lids or holes. Working alone on a crane, which is strictly speaking never allowed, always to be performed by a team of at least two workers. That’s because of the danger of people passing out from the heat, exhaustion, lack of liquid, rest or food, and a crane-operator could very likely be in a critical place when that happens, like over an open pot. Driving vehicles with the lights not working, broken windows or too filthy windows to actually see out is not allowed. Neither is the operation of any vehicles or cranes without proper training, or vehicles and cranes that are broken or not functioning properly. Having your shoes not closed all the way, having an old helmet, old shoes, no dust-mask, standing under an crane in use, not preheating your tools well enough to touch liquid metal or acid. Working in too much loudness, too much darkness or too much pollution. Not getting the breaks that you are entitled to. Teaching yourself how to do things. Working with a person you don’t trust or yourself being in so bad physical state, like suffering illness, fatigue, hunger, pain, that you don’t even trust yourself.

All of these things, I have had to do to finish my duties, just like everybody else in there (at least back then). Of course I could have said no at any given time, but you don’t really want to do that when you know that it is just going to be somebody else, a co-worker who is in the same shoes as you, that will have to take care of it and finish what you left. Everything has to be finished every day no matter what it takes.”

Alcoa Fjarðaál.

The Alcoa plant in the East of Iceland was heralded by the Icelandic Government as the saviour of the waning Eastern economy and a fantastic employment opportunity which would bring young people from Reykjavík to the East. Officials promised up to 1000 permanent jobs, plus another 2.5 jobs created in other sectors for each job in the aluminium industry. Ten years later, however, few of the promised benefits have come to the region, and overall unemployment in Iceland, which was less than 3% in 2005, reached 7.5% in 2009 and remained at 5% 2015.

Alex Smári drove the Alcoa bus from Stöðvarfjörður to Reydarfjörður from 2006 to 2008. He says people in the East believed work in the smelter would be easy, with good pay and plenty of time off, but the reality had turned out to be very different. He described workers returning from their shifts as ‘like corpses’ in the bus, and claims many quit their jobs after a short time. In his opinion the East has not become more thriving as the politicians and company promised, to the contrary “Fjarðabyggd is like a labour camp”.

One worker in the Alcoa Fjarðaál smelter was willing to speak to me though he did not want to be named. Bergur (not his real name) noted the high turnover of workers with many leaving after just a year or two. He claimed around 100 of the 450 employees in the smelter were foreign, suggesting that many in the East simply don’t want to work there. There are only a handful of people who have remained in employment with the company since the smelter opened in 2007.

“Out of twenty people on my shift that started working there five years ago there are only two left. Everyone else quit because they didn’t like working there. The turnover was 20% last year. 20% with all the unemployment in Iceland! It really tells a story.”

Like the Century workers he described how the managers push the workers to work as fast and hard as possible during the shift. However, once they have learnt to work faster the job load simply goes up again.

“The Alcoa building system is devised to suck every bit of what you have. You start with 100 people doing 100 people’s jobs and then you push everyone until 90 people are doing 100 people’s jobs, and then there are 60 and then 50. At Alcoa, everyone gets into the situation where he is working the whole shift doing his absolute best and still walking away with a kick in the butt for not finishing something or other.”

Bergur claimed company people had told them in a meeting that Fjarðaál is the most dangerous of Alcoa’s smelters in Europe. Shifts are twelve hours long and often at night and employees are expected to work 176 hours a month compared with only 142 hours on eight hour shifts at Rio Tinto’s Straumsvík plant near Reykjavík.

There is also a bonus system that rewards the workers for the quantity and quality of aluminium they produce. This means workers effectively get fined when a machine breaks or poor quality alumina is delivered, even though this is out of their control.

“Everything is connected to the bonus. If a crane breaks down and it holds off production it lowers the bonus for everyone. Now we have low quality alumina coming in which means we get through more anodes and that also lowers the bonus. When this situation is going on the workload gets substantially higher, so not only are you working a lot more, but you know you are getting less pay.”

As a result of this pressure Bergur claims the few days off between shifts are usually spent simply sleeping and recovering before work starts again. Contrary to Alcoa’s claims that the workplace is ‘family friendly’ he claims Alcoa Fjarðaál has become known locally as ‘the divorce factory’ since so many couples have separated due to the unsociable hours which affect their relationship.

Bergur also spoke about Alcoa’s use of contract labour, and its effect on worker’s rights and the strength of the unions:

“There are two groups of people working at Alcoa: There are Alcoa employees and there are contractors who are not part of Alcoa. We are doing the same work but they are not members of the unions. By having these two groups they can control the employees more easily and the unity within the factory will be less.”

“We have to live!”

Former Prime Minister of Iceland Halldór Ásgrímsson famously promoted the Alcoa Fjardaál project by proclaiming “we have to live!”. But what kind of livelihood have Icelanders been forced to accept? All of the workers expressed feeling misled by the government and the aluminium companies.

Saga claimed that prospective workers were denied information about the health and safety risks;

“Our government has been been eagerly promoting smelters as very agreeable and good working places for years. Smelters are being promoted in places where people don’t know them, don’t know the dangers, the threats and the health risks, and don’t feel they have a choice. How can a place where you are constantly breathing heavy pollution – alumina, fluoride and dangerous gases – that make you feel like your lungs took a severe beating every time you open up a pot, be a healthy and agreeable working place?”

Bergur analysed the Icelandic government’s claim that the smelter would reverse the East to West migration trend:

“The people who have quit there, who have returned to Reykjavik or whatever…I call those the sensible people. They have moved to the East to work for Alcoa, maybe both man and woman. They come with high hopes and determination to make this work. After working for a year, or a year and a half, the pressure which goes on at the shift becomes too much, and when they realise this is the system and will not change, that they are never going to be in a situation where you are working a relatively easy shift and going home not so tired….this is not going to happen. When they realise that, they quit and get out.”

Steini also questioned the government’s promotion of aluminium smelting as a good employment for Icelanders;

“People in Iceland just wanted jobs, but not necessarily this kind of factory. The question is who put this idea in our minds that the only way to get a job is by having an aluminium smelter?”

Of course, Icelandic smelter workers are not alone in their experience of pollution and dangerous working conditions, and there is much potential to link up with global struggles for workers rights. At Hindalco’s Hirakud aluminium smelter in Odisha, India, workers are taking the company to court asking why they were not told what they were breathing in. They were being moved from the pot-room every four years, told that this was due to the potential health effects of working in such high heats, but the effects of breathing in highly toxic fumes were never mentioned. They believe the company was deliberately concealing the dangers while trying to minimise them.

On top of poor working conditions, employment in the aluminium industry is innately insecure, as it is vulnerable to the peaks and troughs of the commodities supercycle. The recent commodities downturn led to the demise of the UK steel industry, including the likely closure of Port Talbot steel, cutting 11,000 jobs. The workers have already lost part of their pensions, a common phenomenon in the metals industry, as the owners – Tata Steel – claim they cannot afford to pay the full amounts. The rusting skeleton of Century Aluminum’s Helguvík smelter, abandoned midway through construction in 2009, stands as a stark reminder of the false promises and volatility of this industry.

Iceland’s aluminium workers cannot expect their employers, experts in anti-unionising and misleading PR, to protect their rights. Instead, they must properly inform themselves of the risks to their health and security, and contribute to the debate on what constitutes ‘a nice place to work’ in a modern Iceland.

Sources:

Cooke, K. and Gould, M.H. 1991. The health effects of aluminium, a review. The Journal of the Royal Society for the Promotion of Health. 111, 163-8.
Aslam M, Khalil K, Rasmussen RA, et al. (October 2003). “Atmospheric perfluorocarbons”. Environ. Sci. Technol. 37 (19): 4358–61.
Dr R. Liteplo and Ms R. Gomes, 2002, ‘Environmental Health Criteria for Fluorides’. International Programme on Chemical Safety, UNEP. http://www.inchem.org/documents/ehc/ehc/…

Indriði H. Þorláksson, economist and former tax director

Frumvinnsla áls – Lýsing á hinni mengandi og orkufreku framleiðslu álbarra

Helga Katrín Tryggvadóttir

Icelanders are notoriously bad investors. Once someone has a business idea, everyone jumps on the wagon and invests in exactly the same thing. The infamous growth of the banking sector is one example, before the 2008 banking crash the Icelandic banking sector was 12 times the size of the GDP and Iceland was supposed to become an international financial centre. I have no idea how anyone got the idea that an island with three hundred thousand inhabitants could become an international financial centre, but many people in Iceland considered this a perfectly normal ambition.

And then there are the politicians, they have had the same investment idea for more than hundred years. Either it is building an artificial fertiliser factory, or it is building an aluminium smelter. Last year one MP proposed building an artificial fertiliser factory, in order to “lure home” young Icelanders who have moved abroad. A majority of those have moved abroad to educate themselves, but sure, who doesn’t want to use their PhD on the factory floor?

Now there is an Icelandic investor in the North of Iceland, Ingvar Skúlason, who is planning on building an aluminium smelter, at a time when aluminium prices have been dropping due to overproduction. He has already managed to sign a deal with a Chinese company, NFC, which is willing, he says, to pay for the whole construction, yet the smelter would be owned by Icelandic companies. All of this sounds kind of dubious in my ears. And everyone can see that this is not a good idea, even the banks, with a new report released by Arion Bank advising against more investment in the aluminium industry. The bank bases its analysis on the fact that aluminium price is too low at the moment to bring any profit into the country (since the price for the electricity is connected with the price of aluminium, the price the aluminium smelters pay to the National power company (LV) is low when aluminium prices are low).

But that does not stop the politicians from supporting the idea. The prime minister Sigmundur Davíð Gunnlaugsson, was present when Skúlason signed a deal with the Chinese company, praising the initiative. Skúlason also claims to have support from the Minister of Industry, which is not surprising since her only campaign promise was building an aluminium smelter and get the “wheels of the economy rolling”. Recently, Alcoa World Alumina, owned by Alcoa Inc., admitted to having bribed officials in Barein. In Iceland, however, they have never had to pay any bribes. Icelandic officials have been more than willing to do their service for free, “bending all the rules” as Friðrik Sophusson, former head of LV, was caught on tape saying.

There are currently three aluminium smelters in Iceland. Together, they use 80% of the energy produced in the country and their profit account for 60 billion ISK a year (USD 500 million). Yet, a majority of the profit is registered as debt to their parent companies abroad, leaving the Icelandic subsidiaries operated in debt but creating profits to the parent companies. The only profit that is left in the country is the wages they pay to their employees, and that only accounts to less than 1% of the national revenue. The jobs they create (which is usually the main argument for their construction), also account for less than 1% of all jobs in Iceland. The price they pay for the energy is also below the normal market price. Lets think about this for a second: 80% of the electricity produced in the country goes to international corporations that only produce 1% of the national revenue and creates 1% of the jobs, exports the majority of the profits and pays below-market price for the energy. So, 99% of the people do not get any share in the majority of its electricity production. Sounds familiar.

Maybe it is time to occupy the smelters?

Haukur Már Helgason

Last week’s Thursday, the majority of Alþingi’s Industrial Affairs Committee (AIAC) announced its intention to to re-categorize eight sites as “utilizable” options for the construction of hydroelectric power plants. These have until now been categorized, either as for preservation, or as on “standby”. These are categories defined by the Master Plan for nature conservation and utilization of energy resources, as bound by law. The re-categorization would serve as the first legal step towards potential construction.

The proposal had neither been announced on the committee’s schedule, before its introduction, nor introduced in writing beforehand. The committee’s majority gave interested parties a week’s notice to submit comments on the proposal, which is admittedly faster than we managed to report on it.

Reasoning

When asked, by Vísir, why the proposal was made with such haste, without any prior process in the committee or an open, public debate, Jón Gunnarsson, chair of the committee on behalf of the Independence party, replied that “it is simply about time to express the majority’s intention to increase the number of options for utilization.”

The proposal is in accordance with statements made by the Minister of Industry, Ragnheiður Elín Árnadóttir, at Landsvirkjun’s autumn meeting earlier that week, as reported by Kjarninn. In her speech at the occasion the Minister said: “I will speak frankly. I think it is urgent that we move on to new options for energy development, in addition to our current electricity production, whether that is in hydropower, geothermal or wind power. I think there are valid resons to re-categorize more power plant options as utilizable.”

Opposition

As the proposal was introduced to Alþingi, members of the opposition rose against the plans.

Róbert Marshall, Alþingi member in opposition on behalf of Bright Future, has called the lack of process “deadly serious” and “a war declaration against the preservation of nature in the country”. Steingrímur J. Sigfússon, the Left-Greens’ former Financial Minister, concurred, calling the proposal the end of peace over the topic, as did the former Environmental Minister on behalf of the Left-Greens, Svandís Svavarsdóttir, who called the proposal “a determined declaration of war”. Katrín Júlíusdóttir, former Minister of Industry, on behalf of the Social-Democrats’ Coalition commented that the proposal was obviously not a “private jest” of the committee’s chair, but clearly orchestrated by the government as such.

Lilja Rafney Magnúsdóttir, the Left-Greens’ representative in AIAC, and the committee’s vice chair, condemned the proposal. According to her, Minister of the Environment, Sigurður Ingi Jóhannsson, specifically requested fast proposals on these eight options. She says that she considered the data available on all options to be insufficient, except for the potential plant at Hvammur.

That same Thursday, the Icelandic Environment Association (Landvernd), released a statement, opposing the proposal. According to Landvernd’s statement, five of the eight options have were not processed in accordance with law. Landvernd says that the proposal “constitutes a serious breach of attempts to reach a consensus over the utilization of the country’s energy resources.” It furthermore claims that the AIAC’s majority thereby goes against the Master Plan’s intention and main goals.

Landsvernd’s board says that if Alþingi agrees on the proposal, any and all decisions deriving thereof will “constitute a legal offense and should be considered null and void”. Guðmundur Ingi Guðbrandsson, Landvernd’s manager, has since stated that if the plans will proceed, the high lands of Iceland will become a completely different sort of place.

The Iceland Nature Conservation Association (INCA) also opposes the plans. The association released a statement, pointing out that if current ministers or members of Alþingi oppose the Master Plan legislation, they must propose an amendment to the law, but, until then, adhere to law as it is.

The options

Mid-October, Environmental Minister Sigurður Ingi Jóhannsson already proposed re-categorizing one of the eight areas, “the plant option in Hvammur”, as utilizable. This was in accordance with proposals made by AIAC last March. Leaders of the parties in opposition then objected to the decision-making process, saying that such proposals should be processed by Alþingi’s Environmental Committee before being put to vote. The Hvammar plant would produce 20 MW of power.

The other seven options to be re-catogorized are: the lagoon Hágöngulón (two options, totalling 135 MW); Skrokkalda, also related to Hágöngulón (45 MW); the river Hólmsá by Atley (65 MW); lake Hagavatn (20 MW), the waterfall Urriðafoss (140 MW); and Holt (57 MW).

The last two, as well as the plant at Hvammur, would all harvest the river Þjórsá, the country’s longest river. The eight options total at 555 MW.

Backstory: Kárahnjúkar

The latest power plant construction in Iceland took place at Kárahnjúkar. The 690 MW hydropower plant at Kárahnjúkar is the largest of its type in Europe. It fuels Alcoa’s aluminum smelter in Reyðarfjörður. The largest power plant in the country before Kárahnjúkar, was the Búrfell hydropower plant, on-line since 1969, at 270 MW. The Icelandic government and the national power company Landsvirkjun committed to the dam’s construction in 2002, which was concluded in 2008. The total cost of the construction was around USD 1.3 billion. The largest contractor was the Italian firm Impregilo. The construction was heavily contested, for its environmental and economic effects, for the treatment of the workers involved and for a lack of transparency and accountability during the prior decision- and policy-making process.

At least four workers were killed in accidents on site, and scores were injured. “I have worked on dam projects all over the world and no-one has even been killed on any of the schemes. To have this number of incidents on a site is not usual,” commented International Commission on Large Dams (ICOLD) vice president Dr Andy Hughes at the time.

During the construction, the country saw new kinds of protest actions, involving civil disobedience and direct action, led by the organization Saving Iceland. Andri Snær Magnason’s 2006 book Draumalandið – The Dream Land – contesting Iceland’s energy policies, and calling for a reinvigorated environmentalism, became a bestseller at the time. Ómar Ragnarsson, a beloved entertainer and TV journalist for decades, resigned from his work at State broadcaster RÚV to focus on documenting the environmental effects of the Kárahnjúkar plant and campaigning against further construction on that scale.

In the eyes of many, however, the greatest impact was the environmental damage done to a significant part of the country’s wilderness and fragile eco-system, as one thousand square kilometers of land were submerged by the dam. Along with Saving Iceland, INCA was at the forefront of the struggle against the plant’s construction.

Few would contest that the dam construction at Kárahnjúkar was the most dividing topic of debate in the country during the first decade of this century, until the 2008 economic crash. Alþingi’s Independent Investigative Committee, established to investigate the advent of the crash, was not alone in relating the expansive effect of construction on this unprecedented scale to the succeeding crisis.

[Correction: Apart from a 2 MW plant in Kaldakvísl, n]o new power plants have arisen since the construction at Kárahnjúkar. Which plays the bigger role, environmentalist campaigns, or the economic crash which ensued, may be debated. What remains at stake is not any single construction project, as such, but the pro-heavy industry policy, continuous through multiple governments through the last fifty years.

Earlier this November, before the latest turn of events, INCA pointed out that at least three of the options that Landsvirkjun already categorized as “utilizable” were considered for preservation according to the still current Master Plan. Due to this, the association protested the Landsvirkjun’s vice president Ragna Árnadóttir’s recent claims, that the company intended to reach a wide consensus on the use of energy resources.

Landvernd and Landsvirkjun

Landvernd, the Icelandic Environment Association, was founded in 1969. It is among the the country’s leading environmental NGOs, runs several educational programs, lobby groups and reviews parliamentary bills and motions. In the last two decades, its emphasis has moved from the conservation of soil and vegetation towards protecting Iceland’s wilderness and landscapes, not least in the country’s uninhabited central highlands. It has initiated civil disobedience actions, its website citing the Mayday Green Walk in 2013 as an example.

Landsvirkjun is the country’s largest electricity provider, operating seventeen power plants, on a scale from Hafið’s 2MW to Kárahnjúkar’s 690MW. The largest hydroelectric power plant serving the public, rather than industry alone, is the plant at Búrfell, at 270MW.

Original source: Grapevine

Al Jazeera

Some farmers suspect fluoride from aluminium smelters is making animals sick, but the companies sharply disagree.

Reykjavik, Iceland – For the third summer in a row, hydrogen fluoride has been detected in vegetation samples taken near an aluminium plant in eastern Iceland, worrying farmers and horse owners who fear for their animals’ well-being.

Aluminium plants emit fluoride, a chemical element that can be toxic to animals and humans in high concentrations.

The Environment Agency of Iceland found the concentration of fluoride in grass grazed by sheep exceeded the recommended limits near the town of Reydarfjordur.

Sigridur Kristjansdottir from the Environment Agency told Al Jazeera the high levels this summer were “primarily due to meteorological and geographical factors … This resulted in the results for early June showing relatively high values”.

A press release issued by the Alcoa Fjardaal aluminium plant noted that, despite the spike this summer, average fluoride levels this year are lower than they were in 2013, which in turn were lower than in 2012.

Fluoride is a cumulative poison, meaning that animals and plants often register higher levels of the element as they age. Before the Fjardaal aluminium smelter began operation, the fluoride level in Sigurdur Baldursson’s sheep – who live on the only farm near Alcoa’s plant – were measured as having 800 micrograms per gram (µg/g) of fluoride in their bone ash. That’s well below the recommended limit of 4,000 µg/g in the bone ash of adult sheep, or 2,000 µg/g for lambs.

But samples taken in 2013, recorded the sheep’s fluoride levels between 3,300 and 4,000 µg/g. Baldursson said he expects the next readings to exceed 5,000 µg/g – above the recommended limit.

“The sheep that will be sampled next were born in 2007, and are thus as old as the aluminium plant itself,” he told Al Jazeera.

Nevertheless, Baldursson said he has not noticed signs of ill health in his sheep.

‘I only heard about it by accident’

Bergthora Andresdottir sees things differently from her farm on the other side of Iceland, 25km north of the capital Reykjavik. She said she is constantly phoning the Environment Agency to complain about smoke rising from Century Aluminium’s smelter at Grundartangi, directly across the fjord from her farm.

“I phone them several times a week,” she told Al Jazeera. “But there’s no specific person to talk to, and they don’t help much. Sometimes they claim that the smoke is coming from the neighbouring factory [the Elkem ferrosilicon smelter], but I tell them it isn’t.”

In August 2006, an accident at the Grundartangi plant caused a large amount of fluoride emissions. Riding school owner Ragnheidur Thorgrimsdottir said local farmers were never told about this accident, which meant that sheep, cattle and horses ate fluoride-contaminated grass. “I only heard about it by accident, two years later,” she told Al Jazeera.

That same year, the capacity of the Century plant was increased from 90,000 tonnes of aluminium a year to 220,000. The firm HRV Engineering stated “the increase in fluoride for the autumn months of 2006 in the atmosphere … can partly be traced to the increase in capacity of the smelter”.

Sick horses

Thorgrimsdottir lives about five kilometres southwest of the Grundartangi plant, and owns 20 horses – which she said have been badly affected by fluoride, some so badly that they have had to be put down.

“This is the eighth year in a row that my horses have been sick. Currently three of them are sick, but I’m also keeping an eye on four more,” she told Al Jazeera. Instead of keeping her horses outside all the time, as is the norm during Icelandic summers, she has kept them in at night and given them hay to eat because they do not digest grass properly.

Thorgrimsdottir showed Al Jazeera one of the affected horses named Silfursteinn. “The affected horses walk stiffly, like sticks. They also tend to have lumps and swellings on their bodies,” said Thorgrimsdottir.

When asked about Thorgrimsdottir’s horses, Solveig Bergmann – a public relations officer for Century – said she could not explain their maladies. “I have no explanation. According to veterinarians, the horses … bear symptoms of Equine Metabolic Syndrome (EMS), which is caused mainly by obesity and lack of exercise,” she said, citing a report by the Icelandic Food and Veterinary Authority (IFVA).

But Thorgrimsdottir said EMS can also be caused by fluoride, and when IFVA vets took samples from the horses she had to put down, they only measured fluoride levels in their bones, not in their soft tissue as she had requested.

Gyda S Bjornsdottir studied the birth rates and health of sheep from 2007 to 2012 in the area close to the Grundartangi plant for her Master’s degree. She found in the areas southwest and northeast of the smelter – which are the most common wind directions in the region – a higher proportion of sheep did not produce any lambs.

“Usually, two to three percent of sheep do not produce lambs. Away from the plant, 2.6 percent of ewes were lambless, whereas in the area southwest of the plant, this figure was 7.4 percent,” she told Al Jazeera. Northeast of the plant, she added, 4.5 percent of ewes did not bear lambs.

“The sheep in the area to the southwest of the plant also show visible signs of tooth damage, which is a clear sign of fluoride poisoning, and poor quality wool,” said Bjornsdottir.

Because the aluminium smelter is next to a ferrosilicon plant that also emits pollutants, Bjornsdottir said she cannot be sure the effects are caused by fluoride, as there were also increased concentrations of sulphur dioxide, nickel and arsenic.

“But the results are consistent with fluoride distribution,” she said.

‘No evidence’ of negative effects

But Bergmann, the Century public relations officer, disagreed. “In research carried out since 1997 in the vicinity of the Century Aluminium smelter at Grundartangi, no evidence has ever been found of negative effects of fluoride on sheep, or any other animal,” she said.

Bjornsdottir, however, pointed out in her thesis that farmers say it is not economically viable to send sick sheep to a veterinarian. Instead, they slaughter the affected sheep at home. As a result, she said she believes the figures are biased, because the sheep monitored by Century for fluoride are healthy animals that are sent to the slaughterhouse.

In a letter sent by Iceland’s Food and Veterinary Authority to Alcoa in January 2013, Thorsteinn Olafsson – who was responsible for sheep and cattle diseases at that time – said: “There are reasons to suppose that the danger levels for grazing and fodder for Icelandic sheep are even lower than overseas research shows. This needs to be researched even better in the local environment of aluminium plants in Iceland.”

Source: Al Jazeera

See also Hand in Hand: Aluminium Smelters and Fluoride Pollution

More Flouride in Animals Around Aluminium Factories than Elsewhere – Environmental Agency Refuses to Investigate

Saving Iceland would like to recommend this recent and informative film by Bert Ehgartner. Below is a short trailer for the film. You can stream or download the whole film, in either English or German here.

See also: Is Aluminium Really a Silent Killer?

Jamaica Bauxite Mining Videos

Each time a free-floating rumour gets confirmed, and past political behaviour becomes a scandalous spectacle, one cannot resist wondering if such conduct might be going on today. This was the case in 2006, after a grand exposure of espionage the Icelandic state aimed at socialists during the Cold War. During parliamentary discussions following the revelation, Mörður Árnason, MP for the Social-Democratic Alliance (“Samfylkingin”), highlighted the importance of revealing if similar espionage was indeed occurring in present times. If so, he asked, “how is it being conducted? […] Which foreign states have been able to access this information?” Quite typically, those questions were never answered.

Half a decade later, in late 2010, it was revealed that a British police officer, one Mark Kennedy, had travelled around Europe for seven years disguised as environmental and anti-capitalist activist ‘Mark Stone’ and was collecting information about various activist movements and, in some cases, acting as an agent provocateur. Along with the UK, Denmark, Germany, Italy and France — to name but a few of the places where he worked — he did a stint in Iceland’s Eastern highlands in the summer of 2005. In Iceland, he attended a protest camp organised by the environmentalist movement Saving Iceland which targeted the construction of the gargantuan Kárahnjúkar dam and American aluminium giant Alcoa’s smelter in Reyðarfjörður.

The revelation mostly stayed within activist circles and publications, until early 2011, when a public expose of the spy’s true identity lead to the collapse of a UK trial against six climate-change activists, in which Mark’s secretly obtained evidence played a key role. British newspaper The Guardian then took up the case, and the Mark Kennedy saga started to snowball contemporaneously with the broader attention it received, bringing to light a number of other undercover spies.

Sex, Secrecy And Dead Children’s Identities

Shortly after Mark was exposed, Irish and German authorities admitted that he had worked within their jurisdictions and with their knowledge. Due to the ongoing efforts of Andrej Hunko — MP for German left party Die Linke — a truckload of information regarding European cross-border undercover police operations has since seen the light of day.

A recent book on the matter, written by Guardian journalists Paul Lewis and Rob Evans, brings further context to the affair — the mapping of at least 30 years of police espionage and infiltration of environmentalist, anti-racist and anarchist movements in the UK and elsewhere. Among the information revealed, the authors explain how the undercover officers at the Special Demonstration Squad — the undercover unit responsible for the infiltration — had the modus operandi of taking up identities of dead children in order to build up credible alter-egos based on the short lives of real persons.

It has also been revealed that Kennedy — along with others in his position — enjoyed several intimate relationships with some of his prospects, using sex to build up trust and gather information. One infiltrator, Bob Lambert, even fathered a child with one of these women, only to disappear as soon as his undercover employment became too risky. Eight British women who were victims of this tactic have pressed charges against the spies’ employer, the Metropolitan Police, due to the psychological damage they suffered. In a recent episode of investigative TV programme ‘Dispatches’ on Channel 4, some of them described their experience as having been mass-raped by the state, as they would never have consented to sleeping with the police officers had they been aware of their real identities. Adding insult to injury, their claims will not be heard openly — the British High Court recently ruled that it would take place in the secret Investigatory Powers Tribunal.

Saving Hell’s Angels

Enter Iceland, where the big question concerned whether Mark Kennedy had operated with or without the Icelandic authorities’ knowledge and approval. According to the country’s penal code, a foreign party or state’s espionage that takes place within the jurisdiction of the Icelandic state — or is directed at something or someone therein — is illegal and punishable with five-years imprisonment. Had Mark operated without the authorities’ knowledge, it should have caused an international conflict. If he, on the other hand, collaborated with the Icelandic police, it would have equaled the invoking of proactive investigative powers, which the Icelandic police apparently didn’t have at that time.*

Thus the affair entered Iceland’s parliament in late January 2011. Assuming the former version being more likely than the latter, the above-mentioned MP Mörður Árnason asked his fellow party-member and then-Minister for Foreign Affairs, Össur Skarphéðinsson, about the government’s possible actions regarding the matter. After a few lousy personal jokes thrown between the two, Össur claimed he would wait for a report on the matter — conducted by the National Commissioner of the Icelandic Police — which Ögmundur Jónasson, MP for the Left Greens and then Minister of the Interior, had already requested.

But when finally published by the Commissioner’s National Security Unit in May 2011, it was pretty much impossible to estimate the relevance of the report, as the details of Ögmundur’s request were never made public. It was, however, clear that the National Commissioner — whose report literally equated environmentalist activists with Hells Angels — wasn’t about to bring any concrete information out into the public domain.

Lost In Information

Although admitting that the police received information about the activists and their plans via domestic and foreign sources, and that the Icelandic police collaborated with foreign police authorities regarding the protests, the report’s authors nevertheless fully dodged the question regarding the Icelandic police’s alleged collaboration with Mark Kennedy. The main conclusion of the report merely found that “during an overhaul of data at the National Commissioner’s office, no information has come forth enabling an answer regarding whether this agent provocateur […] was here in collaboration with or without the knowledge of the Icelandic police in 2005.”

Despite criticism from Saving Iceland and Árni Finnsson, head of the Iceland Nature Conservation Association, which both accused the minister of condoning cover-ups and evasions by accepting these results, Ögmundur never really touched officially on the issue again. Neither did Össur nor Mörður or — as a matter of fact — anyone else from the establishment.

The truth regarding Kennedy’s operations in Iceland is still not publicly acknowledged, and the absurdity of the issue as it now stands is probably best described by Ögmundur’s own words, taken from an article published on Smugan — a now defunct leftist news-site —  and his last public remark on the report: “The National Commissioner’s report states that the Icelandic police obtained information from abroad concerning the protests at Kárahnjúkar, but that the police do not have information about how this information was obtained.”

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* It is, in fact, questionable if the Iceland police had proactive investigative powers or not. As a result of weak laws and a lack of regulations, it actually seems that until 2011 the police had just about carte blanche regarding whom to spy on and for what reason. See more about it here.

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Click here to go to the support site for the women’s legal action against the Metropolitan Police.

Watch the above-mentioned Dispatches show here below:

The Police’s Dirty Secret (47mins – Dispatches/Channel4 – 24JUN2013) from Casey Oliver on Vimeo.

First published in Grapevine. Based on a 2010 article entitled “Í landi hinna klikkuðu karlmanna.” (“In the Land of the Mad Men”). Translated in part by Haukur S. Magnússon.

After the election, we see the old parties of economic mass destruction are coming back to power. Giving enormous promises of easy money to be wrestled from evil vulture funds, debt relief and tax reduction, The Progressive Party doubled in size after a few years of hardship. There is a jolly good feeling between the two young new leaders of a brave new Iceland, and when a radio host called them up and offered to play them a request, they asked for Duran Duran’s ‘Wild Boys.’ I Googled the lyrics, not quite remembering the lines, and got a nice chill down my back:

Wild boys fallen far from glory
Reckless and so hungered
On the razors edge you trail
Because there’s murder by the roadside
In a sore afraid new world

They tried to break us,
Looks like they’ll try again

Sounds quite grim. This, coupled with the new government’s announcement that it would be effectively dismantling the Ministry for the Environment and Natural Resources and that there will be no Minister for the Environment, gave me a strange flashback feeling. I decided to revisit the state of mind that we used to call normal in 2006. When the economic policy, the energy policy, the expansion of our towns, the mortgages on our homes—almost all aspects of our daily life had become totally mad. This is not my own diagnosis; if you search the homepage of the IMF for the phrase “Collective Madness,” you’ll find this:

“’Iceland, in the decade and a half leading up to the crisis, was an example of collective madness,’ said Willem Buiter, chief economist at Citigroup, a remark that elicited spontaneous applause from the more than 300 participants, many of them Icelandic policymakers, academics, and members of the public.”

In our daily lives, we usually sense what is normal and what is over the top. Sometimes the discourse will blind us; PR and propaganda can create a kind of newspeak. It can be a good exercise to try to talk about things in a foreign language, to view them in a new light. As an Icelander, you could for instance try to tell someone from another country that Iceland’s government sold one state bank and received payment in the form of a loan from another state bank—and vice versa. That the state banks were thereby handed to men that were closely connected to the then-reigning political parties. The manager of one of the parties became head of one of the banks’ board of directors, while the other party’s former Minister of Trade belonged to the group that was given the other bank. That man had access to every bit of inside information about the bank’s standing.

In the meantime, this former Minister of Trade became Central Bank Manager. He went to the US and made Alcoa an offer that the company could not refuse. He had thus set in motion the largest-scale construction project in Icelandic history, greatly increasing economic activity in Iceland—a grand boon for the bank he just finished selling to himself.

If you tell this story in a foreign language, people shake their heads. They gape in disbelief. They use words like “corruption” and “mafia.” They exclaim, full of disbelief and even disappointment, “no, not in Scandinavia!”

THE ACCEPTED INSANITY

It is insane to expand a banking system by tenfold in eight years. We know that now. It isn’t technically possible to grow all the knowledge and experience needed to build up and manage such a contraption in such a short time. Not even by shoving an entire generation through business school. It is impossible.

But the megalomania was not just confined to the banking sector. Energy production in Iceland was doubled from 2002–2007, when the huge Kárahnjúkar dam was built in the eastern part of the highlands—to serve one single Alcoa smelting plant. The energy it produces, about 650MW annually, is enough to power a city of one million people. Doubling the energy production in a developed country over a five-year period is not only unheard of, but it would also be considered ridiculous in all of our neighbouring nations. Most industrialised states increase their energy production by around 2–3% annually. Doubling it would be unthinkable. It has been proven again and again that gargantuan investments generally destroy more than they create.

In Iceland, however, the goal was to double the nation’s energy production AGAIN by building aluminium smelters in Helguvík, Húsavík and enlarging the Straumsvík smelter by more than threefold. The period of insanity was to be succeeded by a total and complete madness. This was to be funded by 4–5 billion dollar 100% loans to Icelandic energy companies from foreign banks. Nearly 20,000 dollars for every single Icelander—every loan directly connected to aluminium prices and secret energy prices. The media reported this as your everyday act of government job-creation. It was regarded extremist to ask critical questions. Many regarded it unthinkable for the survival of the nation NOT to do this.

Now we know that we did not only sacrifice our nature for the economy, we sacrificed nature and the economy. Again, we do not have to seek out the websites of activists or environmental groups for this information. We just go to the IMF reports:

“Executive Directors observed that the Icelandic economy is at a difficult turning point. The long economic expansion, initiated by aluminium sector investments, sustained by a boom in private consumption, and fuelled by ready access to external financing, contributed to a build-up of macroeconomic imbalances and financial vulnerabilities.”

COCAINE IN THE HOT WATER?

The madness made itself clear in the business of geothermal energy, making itself known in the form of financial troubles and enormous debt of the energy companies. The geothermal field had enjoyed an even and stable development since it got started in the early twentieth century. During the great depression, the City of Reykjavík created the world’s largest geothermal heating system by pumping hot ground water into the homes in the city. Later they started producing a small amount of electricity by harnessing steam through turbines. But one day it seemed as if someone drilled into a cocaine vein. Out of the twenty high temperature geothermal areas in Iceland, plans suddenly emerged to harness sixteen right away, all for the sake of the aluminium industry. The energy companies applied for permits to do research drilling in most of the remaining ones. In an instant, the field went from a very slow, conservative development to becoming a geothermal wild west.

In the south, a major development of all the geothermal areas from the Reykjanes Peninsula to Þingvellir was planned—a chain of power plants in pristine and delicate areas—to serve a Century Aluminium smelter in Helguvík. But the geothermal plants would not have sufficed—the remaining power would be squeezed from hydro electricity in the Þjórsá river—potentially threatening the greatest stock of North Atlantic Salmon in Iceland—and up in the highlands—threatening the Pink-footed Geese of Þjórsárver.

So what was referred to as “moderate development” when the parties of The Wild Boys were last in charge of our energy sector? Their plans went like this: A new Alcoa smelter in the east, a new Alcoa smelter in Húsavík, a new Rio Tinto Straumsvík smelter beside the old one, an expansion of the Century smelter in Hvalfjörður and a new Century smelter in Helguvík. Amounting to a total of 1.4 million tons of aluminium. Each one of them needing energy that could serve one million people in their daily lives. Each one of them demanding sacrifice of great natural wonders, wild rivers and pristine geothermal areas.

How did they fare? The Alcoa Smelter in the East has been built, with the destruction of two glacial rivers, Lagarfljót and 50 km2 of highland beauty. The expansion of the Rio Tinto smelter was stopped and the Húsavík smelter did not go through, however, a skeleton of the Helguvík smelter is currently rising—with no power in sight.

The Alcoa smelter in the north would have required all the harnessable power in the northern part of Iceland, only excluding Jökulsá á Fjöllum. Close to Mývatn, we have the Krafla geothermal area. After a long and often struggling forty-year development period, the available power from the area reached about 60 MW. Now, the goal was suddenly to quadruple the area’s energy production—expanding it by 150 MW in just a few years, and harnessing the beautiful Þeistareykir area to its utmost capacity—up to 200 MW. They also had their eyes set on Bjarnarflag and Gjástykki, delicate areas that should be regarded as national heritage sites. All this was to serve a new Alcoa factory they wanted to build close to Húsavík, the famous whale watching and fishing village in North Iceland. Having done all that, however, the energy production would still not reach the 600 MW that Alcoa really needed—the harnessing of two more glacial rivers would have been necessary: Skjálfandafljót with the waterfall Aldeyjarfoss and the glacial rivers running from Hofsjökull.

The interesting thing is not how crazy this seems in hindsight, how extreme, how mad this reality was — but that outsiders did not see this plan as collective madness. The scheme was praised in international media as being a progressive plan for “clean” energy, and we still have members of parliament that regret that this did not happen. And the fact that our labour unions and politicians have referred to this when they say that “nothing is happening” in terms of business and job creation in Iceland. Or that they refer to this when they say “we have still only harnessed X% of our energy.” They are talking about this as a normal feasible future state of Iceland.

Why are people so crazy? Is it or was it a good idea to indebt the nation by a total of 5 billion dollars to place two Alcoa smelting plants in the same constituency? To surround the Faxaflói bay, where 70% of Iceland’s population resides, with three smelters? The answer is simple: The mad men still think so. One of the new Independence Party MPs, Brynjar Níelsson, has no regrets for the death of the river Lagarfljót in service of Alcoa. He said it was apparent that protectionists loved a few fish more than they did people.

But you can still ask like a fool: Did Iceland really have enough accumulated knowledge and manpower to multiply all our energy companies in the space of ten years? Was there never a doubt in the geologist’s mind when he found himself in a magical place such as the Torfajökull area above Landmannalaugar, Kerlingarfjöll or the steam areas around Reykjavík? Did they really want to do drill, pipe and harness EVERYTHING, right away? And do it all for the sake of a single industry—the aluminium industry. Did it have to be the role of a marginalised group of a few activists to use their spare time to criticise this?

OF “REYKJAVÍK” KNOWLEDGE

I was once at a meeting in Húsavík, where I screened my film, ‘Dreamland.’ At that meeting, the local geothermal plant manager claimed he could easily harness 1,000 MW out of geothermal areas north of Mývatn. I asked if it wasn’t correct that scientists are concerned about overexploitation of the country’s geothermal areas. The scientists’ criticisms were quickly blown off the table as “Reykjavík knowledge,” and in that instant every alarm bell went off.

Now we understand that power is not as plenty as the hype promised, and now most Icelanders understand that energy production on the banks of Lake Mývatn in Bjarnarflag might just jeopardise the ecosystem in that wonderful lake. But you wonder if the people developing our most delicate areas possess good enough judgement to work close to natural wonders. It seems like they are ready to take the risk, to see what happens.

I found an interview with the aforementioned plant manager from 2002. At that time, he had drilled a big hole for 170 million ISK because a Russian company potentially wanted to build an aluminium oxide factory and a giant aluminium plant in Húsavík.

If one sets aside minor ethical facts, such as the Russian aluminium industry being run by the mafia at that time, one is still left to ponder the fact that almost no industry in the world produces as much and as toxic waste as aluminium oxide production (or alumina, as it is called). Those that followed the horrible events when a red slush toxic lake in Hungary broke should know what comes with an alumina refinery. But this local hard-working man had spent more than one and a half million dollars looking into the feasibility of such a plant in Húsavík. Things have been so good here that people think they are untouchable.

Even though the companies engage in malevolent practices in other countries, they would never do that here. Sure.

THE HOLY LOCAL

It seems that for some reason the most unbelievable hogwash gets promulgated without any critical thought. We enter a boom after boom and never learn from mistakes. We can look further back in history to see how madness is mixed up with ambition, how extreme and unrealistic views of the future are presented and taken seriously.

In an edition of Morgunblaðið from March 1987, one can read a prediction of the impending evolution of local fur farming until 1996. At that time, thirty fur farms were operated in Iceland. Morgunblaðið cites a report that predicts Iceland will foster 600 mink farms by 1996. They assume a twenty-fold growth in ten years, as if nothing were more natural. A month later, this optimistic story ran: “The mink stock will double this year.” Only three years later, in April of 1990, we find this dramatic headline in a copy of Morgunblaðið: “Fur farming: The industry is on its last legs. Many farmers on the edge of despair.”

In this country everything is considered normal if a “local” wants it. Nothing in Iceland is as crazy as the holy local is when he wants a smelter or an oil refinery, no matter how large or out of proportion. He has the sacred right to that, especially if he uses “job creation” as an argument. Numbers that would be considered sizeable in large nation’s economic statistics, energy resources and infrastructure that are earmarked by the world’s superpowers as being “strategically important” are subject to “the will of the locals.” The nation’s energy resources and nature are in the hands of a smattering of district councils that have no staff and no expertise while the majority of Icelanders that reside in the capital area seem by default “local” to nowhere.

So, the locals of the east destroyed their highlands, the locals of the south want to dam the wonders of the Skaftá area, the lower part of the Þjórsá river and the locals of the southwest are ready to harness almost every single geothermal area. And this seems to be a global problem—rural communities losing their youth and talents to the cities of the world are willing to sell off their forests, their mountains, their rivers and valleys for some hope of development and a future.

It is strange to see that one of the major driving forces behind this development resides within our labour leaders, who have been demanding extreme leverage and risk on behalf of public energy companies. If there should be a hesitation in the risk taking, the responsible parties are “dragging their feet.” The labour unions’ “stability agreement” with the former government entails that “every obstacle be removed” that somehow hinders the proposed Helguvík aluminium plant. It is exactly this kind of thinking that lead to almost 200 foreign workers being left disabled and unemployable as a result of working on building the Kárahnjúkar dam. Conditions of workers were severely compromised to make the dam construction process cheap enough. Every obstacle was removed to provide Alcoa with energy prices that save them 200 million USD annually. That amounts to the combined yearly wages of more than 10,000 teachers.

The noble cause of creating jobs becomes quite grim if it involves harming the work capacity of so many. The PR people talk about a ‘multiplication effect’ of every job in a smelter—but wouldn’t it be polite to subtract the disabled workers? People will go so far to satisfy their prince charming that they behave like the ugly stepsister in the fairy tale, cutting their toes off to fit the glass shoe.

HOUSE OF CARDS

The Helguvík aluminium smelter close to Keflavík Airport is a symbol of how poorly run Iceland can be; the Helguvík aluminium smelter is already being built, even though nobody knows where we can scramble together its required 600 MW of energy. The Helguvík smelter is a symbol of how weak the nation’s administration can be, of how shattered professionalism and long-term thinking can become, and how the media all but encourages unlawful activities in their headlines, if job creation is at stake. They started to build the smelter without access to power sources, and without the necessary power lines planned or agreed upon by landowners.

Why start building, then? Because in 2006, the Wild Boys were in power, showing their ambition and “competence” by signing long term sales agreements for cheap energy before the energy sites had been researched, planned or developed. Now Reykjavík Energy and HS Orka are bound by agreements that neither company wants to fulfil due to foreseeable losses from selling the energy below its production costs.

The sharks were very aware that they were taking advantage of a country with mad politicians in a rare period in our history. When they were willing to sell almost everything, anything, anywhere to anyone. In a remarkable investor report called: “Harnessing unlimited power and profit from the world’s most progressive energy program,” an analyst made this great comment:

“It works out great for Iceland, too. It is very cheap for Iceland to deliver power to Century. The Icelandic power companies will make extraordinary profits on that power if aluminium prices stay strong. And if aluminium prices weaken, Iceland is not biting the hand that feeds it.”

This is how politicians build an elaborate house of cards that combine risk, debt and commitment that collapses if only one of the cards falls. Thus, the hands of future city governments have been tied and an insane construction binge in important areas has been commenced, all to benefit one company that’s lacking most of the needed permits.

Could anyone recount the details of the Century Aluminium Helguvík Smelter project at an international conference without being booed off the stage as a fraud? At an aluminium conference, however, such a man would actually bring more lust than an exotic dancer.

Despite being in the hands of extreme capitalists, the labour movement has not called for professionalism or long-term thinking in energy affairs. It simply demands that “every obstacle be removed.” Get the trucks rolling immediately.

In 2006 we were in the middle of a revolution, but the Wild Boys did not call themselves “The Aluminium Revolutionary Front”—they defined themselves as the norm, even though their scale was insane. If they were criticised, they started thinking of themselves as persecuted. Warlords are always persecuted moderates when they’re merely conquering neighbouring nations in the name of peace.

THE CORE OF THE PROBLEM

Throughout the years, polls have shown that a large part of Icelandic males aged 40–70 have been in favour of the collective insanity seen in the energy policy of 2006. The biggest problem seems to be with male voters of The Independence Party, where a vast majority has even considered the most extreme energy policy as the sole basis for the continued survival of Icelanders. That explains the great emotional attachment they have to dams and smelters. To secure their survival, the majority of them wants to cut back on our environmental regulations, and they have no standards whatsoever on the ethical background of the corporations coming to Iceland.

Therein lies Iceland’s most serious political ill. If everything were normal, our males would be conservative, moderate, aversive to risk, frugal, orderly and even a bit boring. This is an important group of people in every society. It contains a lot of average household fathers; it contains pillars of society, company directors, influentials, MPs and even journalists and editors. These are men that have the power to define what is normal and what is abnormal and/or excessive.

OF RESPONSIBLE PUNKS AND SURREALISTS

It is harmful for communities when a critical mass of their important males starts adhering to revolutionary and completely reckless ideas, adopting a blind belief in them. This group is not fit for governing anything while the situation lasts, and it is therefore no coincidence that the city of Reykjavík is now governed by the punkers and surrealists of the Best Party. A moderate mixture of surrealism and punk rock is a down to Earth, conservative and responsible policy when compared to the delusions and anarchy of the crazed men. They have proved very moderate and responsible, and have now moved the policy of Reykjavík Energy, Reykjavík’s energy company, into a more sustainable and modest direction. And the Left Green Social Democrat government did the same with Landsvirkjun, the national energy company.

Those that are worst off in this group of mad men share a mutual admiration for Einar Benediktsson (1863-1945). The Icelandic National Myth is perhaps best embodied in the figure Einar Ben, our poet of progress. His most recent biography gives a good picture of the kind of man he was and the impulses that motivated his actions:

What drives Einar Benediktsson on to undertake this long journey […] is his unshakeable belief in his own abilities to be of use to his impoverished fatherland in countries abroad. His dream is to furnish the money that will transform Iceland into a modern country, with towns, factories, railways, roads, harbours and large-scale farms. He carries nothing with him except his belief in himself…

Einar Benediktsson had great dreams for the future of Iceland, replete with hydroelectric dams, factories and railways. While his generation on both sides of the Atlantic saw their dreams become a reality, and sometimes a nightmare, Einar was to be disappointed in all his great hopes and ambitions. Henry Ford was born a year before Einar Benediktsson, and Sam Eyde, the founder of Norway’s Norsk Hydro was born three years after him. But Iceland failed to industrialize in the way Einar envisaged. Whether Iceland was fortunate or unfortunate to have missed out on the Industrial Revolution is something we can argue over. But the failure of Einar’s dreams left an unfilled space in the Icelandic soul. Iceland’s wealth came from fishing, but Einar’s ideas still hovered in the air, leaving a sense of a task left unfulfilled—the unfinished Icelandic dream. The Americans could move on from Ford to Gates. The Icelanders were still lacking a Ford.

One of the first bubbles in Iceland happened when businesspeople travelled the country buying rights to harness waterfalls in the beginning of the 20th century. Einar Ben had the Norwegian engineer Sætersemoen draw up a row of power plants spanning the entirety of Þjórsá. The drawings of the proposed power plants look magnificent and enticing and would without doubt be considered among Iceland’s most beautiful buildings had they been constructed. But how realistic were the plans? They had planned for harnessing Þjórsá to produce 600–800 MW—in 1918, nota bene. This does not include the rest of the water rights these men had secured for themselves, including Dettifoss and Gullfoss. In comparison one could note that today, one hundred years later, the City of Reykjavík uses 200 MW—on Christmas Eve, with every electric appliance running at full steam.

What did Einar plan on doing with all this energy in 1918? Aluminium production was barely on the horizon as a feasible industry, and televisions and freezers were but distant dreams. What were they planning to do with all the power? Produce fertiliser? The Gufunes fertiliser plant used around 20 MW when it was running at its peak. Who was to use all the energy and pay for the series of power plants? The answer is likely simple: No one. No one in the world could have found use for this energy.

Of course Einar could easily have harnessed a small stream to light up a small village, maybe even a cowshed or two. But there is no glory in that. The act would not appease the deranged men’s need for conquest and magnitude. There’s much more spunk, gusto and vigour in lining all of Þjórsá with power plants, even if the energy produced is way beyond what the nation can use one hundred years later. To this day, a lot of people think that Iceland’s government at that time was backwards, afraid of foreigners and somehow prevented the founding of a great and profitable company and “foreign investment.” But it’s enough to look at the numbers to see that the whole thing was a sham.

It’s so weird to think that, ever since, a certain group of Icelandic males have harboured a strange sort of national grief. It’s as if Einar’s unrealistic ideas have been haunting later generations of Icelanders. Not as fantasy, but as real, attainable goals or lost opportunities: “The dreams of our turn of the century poets have finally come true.” Remarked former PM Geir Haarde as he signed a deal with Alcoa in 2002. Yes, finally, the nation was dragged into a century old illusion.

THE MAD MEN VS. THE WISE GIRLS

The mob seems tolerate nothing worse than young, educated women who that use words like “professional” or “process.” Even if aluminium production in Iceland has been tripled over the last ten years, a lot of the crazy guys think that Iceland’s economic problems stem first and foremost from a lack of aluminium smelters.

Supporters of a new Century Aluminium smelter in Helguvík spent millions in advertisements campaigning against departing Minister for the Environment Svandís Svavarsdóttir, who delayed the building process with demands of a sober overview of the energy demand and environmental impact. The blogosphere went wild when Left-Green MP Kolbrún Halldórsdóttir spoke up against deep-sea oil drilling in Icelandic waters. One sensed a lynch mob in the making as former-Minister for the Environment Þórunn Sveinbjarnardóttir met with locals in Húsavík advocating for a full environmental impact assessment for a new Alcoa smelter—the audience was only lacking the pitchforks. The decline of The Independence Party is very evident in the fact that Katrín Fjeldsted lost her seat in parliament. She is a well-educated, intelligent and logical doctor and the only party MP who questioned the insanity. Every obstacle shall be pushed out of the way.

Icelanders harvest 1% of the world’s fish. We receive more tourists per capita than most nations. Iceland has harnessed five times the amount of energy that the nation needs to function, and we currently operate three aluminium smelters. But we have ALREADY harnessed five times more energy than our neighbouring countries. We are already an energy superpower—if everything were normal, such an investment should yield a fair bit of profit to the nation, if we don’t blow the proceeds and resources in another round of debt. But the discourse is so crazy. People act as if “NOTHING IS PERMITTED” when the energy production is already five times more than the nation can consume. Of the energy we produce, 90% already goes to smelters.

We already have everything a modern society needs. We just need to tend to what we have already built, to reap some profit from the power plants we have already constructed and take better care of what we’re currently fishing. People get insecure when interest groups moan: “Who will support us in the future?!?” as if Iceland is a country without foundations. The fear that is purposely spread is resulting in Iceland acting like a man that demands radiotherapy, chemotherapy and surgery to fix his headache. The truth is that the treatment will never cure him—but it might kill him. He will in the best-case scenario grow addicted to the drugs.

THEY TRIED TO BREAK US…

We are a small community and we need peace and room to work. That Björk should need to take time off work to fight the insanity is just a small example of the disturbance that thousands of Icelanders suffer every day because of this crazy nonsense. Living here will become unbearable if something like the reckless policy from 2006 goes full speed again. It is maddening that we cannot seem to leave our most beautiful areas alone. We are a small community where co-dependency is the norm and people are polite.

The new leaders are young and nice guys; Sigmundur Davíð loves old buildings and has good ideas for city planning. But behind them is a crowd of mad men, “fallen far from glory, reckless and so hungered.” Were four years from power enough to sober up the mentality in terms of the energy policy? What will come out of the “rethinking” of the Energy Master Plan? Will we be strapped up into another rollercoaster, just to take another ride of boom and bust? “They tried to break us. Will they try again?”

People can let off steam, get angry, shudder at the thought of it… ‘Who do these politicians think they are?’ ‘Scumbag generals!’ […] And they get more and more angry, and then, burp! A little liberatory burp to relieve their social indigestion.

These words came to mind last month when Iceland’s media reported upon the current situation of river Lagarfljót in the east of Iceland. “Lagarfljót is dead,” some of them even stated, citing the words of author and environmentalist Andri Snær Magnason regarding a revelation of the fact that the river’s ecosystem has literally been killed by the the gigantic Kárahnjúkar Dams. The dams were built in Iceland’s eastern highlands in the years between 2002 and 2006, solely to provide electricity for aluminium giant and arms producer Alcoa’s smelter in the eastern municipality of Reyðarfjörður.

The revelation of Lagarfljót’s current situation originates in a report made by Landsvirkjun, Iceland’s state owned energy company and owner of the 690 MW Kárahnjúkar power plant, the main conclusions of which were made public last month. Although covered as breaking news and somewhat of a scandal, this particular revelation can hardly be considered as surprising news.

Quite the contrary, environmentalists and scientists have repeatedly pointed out the mega-project’s devastating irreversible environmental impacts — in addition to the social and economical ones of course — and have, in fact, done so ever since the plan was brought onto the drawing tables to begin with. Such warnings, however, were systematically silenced by Iceland’s authorities and dismissed as “political rather than scientific”, propaganda against progress and opposition to “green energy” — only to be proven right time and time again during the last half a decade.

AQUATIC ECOSYSTEMS SHOULD RECEIVE MORE ATTENTION

One of the Kárahnjúkar plant’s functions depends on diverting glacial river Jökulsá á Dal into another glacial river Jökulsá í Fljótsdal, the latter of which feeds Lagarfljót. This means that huge amounts of glacial turbidity are funnelled into the river, quantitatively heretofore unknown in Lagarfljót. This has, in return, led to the disintegration of Lagarfljót’s ecosystem, gargantuan land erosion on the banks of the river, serious decrease in fish population and parallel negative impacts on the area’s bird life.

As reported by Saving Iceland in late 2011, when the dams impacts on Lagarfljót had become a subject matter of Iceland’s media, the glacial turbidity has severely altered Lagarfljót’s colour. Therefore, sunlight doesn’t reach deep enough into the water, bringing about a decrease of photosynthesis — the fundamental basis for organic production — and thereby a systematic reduction of nourishment for the fish population. Recent research conducted by Iceland’s Institute of Freshwater Fisheries show that in the area around Egilsstaðir, a municipality located on the banks of Lagarfljót, the river’s visibility is currently less than 20cm deep compared to 60cm before the dams were constructed. As a result of this, not only is there less fish in the river — the size of the fish has also seen a serious decrease.

Following last month’s revelation, ichthyologist Guðni Guðbergsson at the Institute of Freshwater Fisheries, highlighted in an interview with RÚV (Iceland’s National Broadcasting Service) that the destruction of Lagarfljót’s ecosystem had certainly been foreseen and repeatedly pointed out. He also maintained that aquatic environment tends to be kept out of the discourse on hydro dams. “People see what is aboveground, they see vegetation, soil erosion and drift,” he stated, “but when it comes to aquatic ecosystems, people don’t seem to see it very clearly. This biosphere should receive more attention.”

BENDING ALL THE RULES

All of the above-mentioned had been warned of before the dams construction took place, most importantly in a 2001 ruling by Skipulagsstofnun (Iceland’s National Planning Agency) which, after reviewing the Kárahnjúkar plant’s Environmental Impact Assessment, concluded that “the development would result in great hydrological changes, which would have an effect, for example, on the groundwater level in low-lying areas adjacent to Jökulsá í Fljótsdal and Lagarfljót, which in turn would have an impact on vegetation, bird-life and agriculture.” The impacts on Lagarfljót being only one of the dams numerous all-too-obvious negative impacts, Skipulagsstofnun opposed the project as a whole “on grounds of its considerable impact on the environment and the unsatisfactory information presented regarding individual parts of the project and its consequences for the environment.”

However, Iceland’s then Minister of the Environment, Siv Friðleifsdóttir, notoriously overturned the agency’s ruling and permitted the construction. Although her act of overturning her own agency’s ruling is certainly a unique one, it was nevertheless fully harmonious with the mega-project’s overall modus operandi: For instance, during Alcoa and the Icelandic government’s signature ceremony in 2003, Friðrik Sophusson, then director of Landsvirkjun, and Valgerður Sverrisdóttir, then Minister of Industry, boasted of “bending all the rules, just for this project” while speaking to the US ambassador in Iceland.

A BIOLOGICAL WONDER TURNED INTO DESERT

As already mentioned, the destruction of Lagarfljót is only one of the dams irreversible impacts on the whole North-East part of Iceland, the most densely vegetated area north of Vatnajökull — the world’s largest non-arctic glacier — and one of the few regions in Iceland where soil and vegetation were more or less intact. Altogether, the project affects 3,000 square km of land, no less than 3% of Iceland’s total landmass, extending from the edge of Vatnajökull to the estuary of the Héraðsflói glacial river.

Sixty major waterfalls were destroyed and innumerable unique geological formations drowned, not to forget Kringilsárrani — the calving ground of a third of Iceland’s reindeer population — which was partly drowned and devastated in full by the project. In 1975, Kringilsárrani had been officially declared as protected but in order to enable the Kárahnjúkar dams and the 57 km2 Hálslón reservoir, Siv Fiðleifsdóttir decided to reduce the reserve by one fourth in 2003. When criticized for this infamous act, Siv stated that “although some place is declared protected, it doesn’t mean that it will be protected forever.”

The dams have also blocked silt emissions of the two aforementioned glacial rivers, Jökulsá á Dal and Jökulsá í Fljótsdal, resulting in the receding of the combined delta of the two rivers — destroying a unique nature habitat in the delta. In their 2003 article, published in World Birdwatch, ornithologists Einar Þorleifsson and Jóhann Óli Hilmarsson outlined another problem of great importance:

All glacier rivers are heavy with sediments, and the two rivers are muddy brown in summer and carry huge amounts of sediment, both glacial mud and sand. The Jökulsá á Dal river is exceptional in the way that it carries on average 13 times more sediment than any other Icelandic river, 10 million metric tons per year and during glacial surges the amount is many times more. When the river has been dammed this sediment will mostly settle in the reservoir.

In contravention of the claim that Kárahnjúkar’s hydro electricity is a “green and renewable energy source,” it is estimated that the reservoir will silt up in between forty and eighty years, turning this once most biologically diverse regions of the Icelandic highlands into a desert. While this destruction is slowly but systematically taking place, the dry dusty silt banks caused by the reservoir’s fluctuating water levels are already causing dust storms affecting the vegetation of over 3000 sq km, as explained in Einar and Jóhann’s article:

The reservoir will be filled with water in autumn but in spring 2/3 of the lake bottom are dry and the prevailing warm mountain wind will blow from the south-west, taking the light dry glacial sediment mud in the air and causing considerable problems for the vegetation in the highlands and for the people in the farmlands located in the valleys. To add to the problem the 120 km of mostly dry riverbed of Jökulsá á Dal will only have water in the autumn, leaving the mud to be blown by the wind in spring.

This development is already so severe that residents of the Eastfjords municipality Stöðvafjörður, with whom Saving Iceland recently spoke, stated that the wind-blown dust has been of such a great deal during the summers that they have often been unable to see the sky clearly.

All of the above-mentioned is only a part of the Kárahnjúkar dams over-all impacts, about which one can read thoroughly here. Among other factors that should not be forgotten in terms of hydro power would be the dams’ often underestimated contribution to global warming — for instance via reservoirs’ production of CO2 and methane (see here and here) — as well as glacial rivers’ important role in reducing pollution on earth by binding gases that cause global warming, and how mega-dams inhibit this function by hindering the rivers’ carrying of sediments out to sea.

TEXTBOOK EXAMPLE OF CORRUPTION AND ABUSE OF POWER

“Lagarfljót wasn’t destroyed by accident,” Andri Snær Magnason also said after the recent revelation, but rather “consciously destroyed by corrupt politicians who didn’t respect society’s rules, disregarded professional processes, and couldn’t tolerate informed discussion.” The same can, of course, be said about the Kárahnjúkar ecological, social and economical disaster as a whole, the process of which was one huge textbook example of corruption and abuse of power.

Responding to same news, Svandís Svavarsdóttir, Iceland’s current Minister of the Environment, cited a recent report by the European Environment Agency, titled “Late Lessons from Early Warnings,” in which the results of a major research project into mega-project’s environmental impacts and public discussion are published. One of the damning results, the report states, is that in 84 out of 88 instances included in the research, early warnings of negative impacts on the environment and public health proved to be correct.

This was certainly the case in Iceland where environmentalists and scientists who warned of all those foreseeable impacts, both before and during the construction, found themselves silenced and dismissed by the authorities who systematically attempted to suppress any opposition and keep their plans unaltered.

One of the most notorious examples of this took place after the publication of Susan DeMuth’s highly informative article, “Power Driven,” printed in The Guardian in 2003, in which she highlighted all the up-front disastrous impacts of the project. The reaction in Iceland was mixed: While the article served as a great gift to Icelandic environmentalists’ struggle — tour guide Lára Hanna Einarsdóttir suggesting “that an Icelandic journalist would have lost their job if he or she had been so outspoken” — the reaction of the project’s prime movers was one of fury and hysteria. Mike Baltzell, president of Alcoa Primary Development and one of the company’s main negotiators in Iceland, wrote to The Guardian accusing DeMuth of “creating a number of misconceptions” regarding the company’s forthcoming smelter. Iceland’s Ambassador in the UK and Landsvirkjun’s Sophusson took a step further, contacting the British newspaper in a complaint about the article’s content and offering the editor to send another journalist to Iceland in order to get “the real story” — an offer to which the paper never even bothered to reply.

Another example is that of Grímur Björnsson, geophysicist working at Reykjavík Energy at that time, who was forbidden from revealing his findings, which were suppressed and kept from parliament because they showed the Kárahnjúkar dams to be unsafe. His 2002 report, highly critical of the dams, was stamped as confidential by his superior at the time. Valgerður Sverrisdóttir, then Minister of Industry, subsequently failed to reveal the details of the report to parliament before parliamentarians voted on the dams, as she was legally obliged to do. Adding insult to injury, Grímur was finally deprived of his freedom of expression when his superior at Reykjavík Energy — taking sides with Landsvirkjun — prohibited him to speak officially about the Kárahnjúkar dams without permission from the latter company’s director at that time, Friðrik Sophusson.

THE SHADOW OF POLLUTED MINDS

Similar methods applied to the East-fjords and other communities close to the dams and the smelter, where the project’s opponents were systematically ridiculed, terrorized and threatened. One of them is Þórhallur Þorsteinsson who, in a thorough interview with newspaper DV last spring, described how he and other environmentalists from the East were persecuted for their opposition to the dams. In an attempt to get him fired from his job, politicians from the region even called his supervisor at the State Electric Power Works, for which he worked at the time, complaining about his active and vocal opposition. Another environmentalist, elementary school teacher Karen Egilsdóttir, had to put up with parents calling her school’s headmaster, demanding that their kids would be exempt from attending her classes.

Farmer Guðmundur Beck — described by DeMuth as “the lone voice of resistance in Reyðarfjörður” — was also harassed because of his outspoken opposition towards the dams and the smelter. After spending his first 57 years on his family’s farm where he raised chicken and sheep, he was forced to close down the farm after he was banned from grazing his sheep and 18 electricity pylons were built across his land. Moreover, he was literally ostracised from Reyðarfjörður where Alcoa’s presence had altered society in a way thus described by Guðundur at Saving Iceland’s 2007 international conference:

In the East-fjords, we used to have self-sustaining communities that have now been destroyed and converted into places attracting gold diggers. Around the smelter, there will now be a community where nobody can live, work or feed themselves without bowing down for “Alcoa Director” Mr. Tómas.* — We live in the shadow of polluted minds.

(*Mr. Tómas” is Tómas Már Sigurðsson, Managing Director of Alcoa Fjarðaál at that time but currently president of Alcoa’s European Region and Global Primary Products Europe. Read Guðmundur’s whole speech in the second issue of Saving Iceland’s Voices of the Wilderness magazine.)

A LESSON TO LEARN?

All of this leads us to the fact that Icelandic energy companies are now planning to go ahead and construct a number of large-scale power plants — most of them located in highly sensitive geothermal areas — despite a seemingly non-stop tsunami of revelations regarding the negative environmental and public health impacts of already operating geothermal plants of such size. This would, as thoroughly outlined by Saving Iceland, lead to the literal ecocide of highly unique geothermal fields in the Reykjanes peninsula as well as in North Iceland.

Two of the latter areas are Þeistareykir and Bjarnarflag, not far from river Laxá and lake Mývatn, where Landsvirkjun wants to build power plants to provide energy to heavy industry projects in the north. Large-scale geothermal exploitation at Hellisheiði, south-west Iceland, has already proven to be disastrous for the environment, creating thousands of earthquakes and a number of polluted effluent water lagoons. The Hellisheiði plant has also spread enormous amounts of sulphide pollution over the nearby town of Hveragerði and the capital area of Reykjavík, leading to an increase in the purchasing of asthma medicine. Another geothermal plant, Nesjavallavirkjun, has had just as grave impacts, leading for instance to the partial biological death of lake Þingvallavatn, into which affluent water from the plant has been pumped.

Responding to criticism, Landsvirkjun has claimed that the Bjarnarflag plant’s effluent water will be pumped down below lake Mývatn’s ground water streams. However, the company has resisted answering critical questions regarding how they plan to avoid all the possible problems — similar to those at Hellisheiði and Nesjavellir — which might occur because of the pumping and thus impact the ecosystem of Mývatn and its neighbouring environment. In view of this, some have suggested that Iceland’s next man made ecological disaster will be manifested in a headline similar to last month’s one — this time stating that “Mývatn is dead!”

Concluding the current Lagarfljót scandal — only one manifestation of the foreseen and systematically warned of Kárahnjúkar scandal — the remaining question must be: Will Icelanders learn a lesson from this textbook example of political corruption and abuse of power?

Recent polls regarding the coming parliament elections on April 27, suggests that the answer is negative as the heavy-industry-friendly Framsóknarflokkur (The Progressive Party), for which both Siv Friðleifsdóttir and Valgerður Sverrisdóttir sat in parliament, seems to be about to get into power again after being all but voted out of parliament in the 2007 elections. Following the Progressives, the right-wing conservative Sjálfstæðisflokkur (The Independence Party) is currently the second biggest party, meaning that a right-wing government, supportive of — and in fact highly interrelated to — the aluminium and energy industries, is likely to come into office in only a few days from now.

In such a case, Iceland will be landed with the very same government that was responsible for the Kárahnjúkar disaster as well as so many other political maleficences, including the financial hazardousness that lead to the 2008 economic collapse and Iceland’s support of the invasion in Iraq — only with new heads standing out of the same old suits. Sadly but truly, this would fit perfectly with the words of Dario Fo’s Maniac when he states on behalf of the establishment:

Let the scandal come, because on the basis of that scandal a more durable power of the state will be founded!

The truth is that aluminium smelters and serious fluoride poisoning go hand in hand. Aluminium smelting is the largest single producer of fluorides worldwide. These toxic compounds are released from smelters in both gaseous and solid forms. ‘Scrubbers’ are usually used to remove the majority of fluorides from factory smoke today, but when those scrubbers are spent they are also dumped in landfills where the soluble fluorides absorbed into them can leak out into the soil. Fluorides are phytotoxic (toxic to plants) and actually accumulate in vegetation, making long living trees particularly susceptible to fluoride poisoning. When animals or humans eat fluoride polluted plants or meat, or drink fluoride rich water, they can develop ‘fluorosis’ which weakens bones and teeth and can, in extreme cases, lead to bone deformation and birth defects. Fluoride can also build up in soft tissue in the body causing a range of serious health effects¹.

Swollen Jaws and Weak Teeth

In West Iceland, a number of farmers living around the Century Aluminum (Norðurál) smelter in Hvalfjörður have been suffering serious fluoride pollution in their sheep and horses – in particular since a major pollution incident at the factory released large amounts of fluorides in August 2006.

Sigurbjörn Hjaltason and his wife Bergþóra run a sheep farm at Kiðafell on the South side of the fjord, across the water from the 280 thousand ton aluminium smelter and Elkem’s steel alloy factory. Their sheep have recently developed swollen jaws and weak teeth which break easily and are, in some cases, unable to feed properly and have therefore died. Not satisfied with the industry’s own monitoring, they sent a few of their sheep heads for independent investigation and found fluoride levels of up to 1300-1400ppm, against a baseline (normal level) of 300-400ppm. Sigurbjörn and Bergþóra point out that Umhverfisstofnun (The Environment Agency of Iceland) give no maximum level of fluoride permitted in livestock teeth in Century Aluminum’s license, or elsewhere. Norðurál themselves use a guideline that is based on Norwegian research on young deer and suggests that between 1000 and 2000ppm can cause damage to teeth, and above 2000ppm damage is certain to occur. Sigurbjörn and Bergþóra claim that even this guideline is too high to prevent disease and even death of sheep as they have experienced.

Despite complaints regarding the unacceptably high levels for permitted fluoride, filed by Sigurbjörn and Bergþóra to Umhverfisstofnun and MAST (Iceland’s Food and Vetinary Authority), the situation has not improved.

A Story of Silence

Across the fjord, about four kilometers West of the smelter, stands a farm called Kúludalsá. The owner, Ragnheiður Þorgrímsdóttir, runs an outdoor education center and keeps horses for pupils to ride and learn from. She has looked after horses since her childhood without problems, but in 2007 her horses suddenly started to get sick. They developed a build up of material in the neck and became stiff and unwell, in some cases too stiff to be able to walk. In an interview with Saving Iceland, she explained that in August 2006, while Century were expanding their smelter, a failure occurred in the plant’s scrubbing system with the results that raw fluoride was emitted for at least 20 hours. Local farmers were given no warnings or information, “They told no-one about it until many months later when they were forced to do so because the figures showed that something serious had happened” Ragnheiður said.

She wrote to MAST and requested a formal investigation in April 2009. The agency passed her request to Umhverfisstofnun who declined to act on it until two years later under public pressure. Ragnheiður had already sent samples of bones to local labs, discovering fluorine levels about four times higher than the estimated baseline, nevertheless still technically below the legal limit. In May 2011, she told her story on RÚV, Iceland’s National Broadcasting Service; only two days later she received a letter from Umhverfisstofnun, announcing their formal refusal to investigate the matter.

Finally in spring 2011, MAST agreed to investigate samples of horse teeth and bones from Kúludalsá. However, they didn’t examine fluoride in the liver and other organs as they had been requested to do, claiming that fluoride doesn’t build up in the soft tissues. Following their investigation MAST terminated her case, concluding that Ragnheiður could be blamed for the horses’ sickness herself which was due to overfeeding. At this point she decided to take matters into her own hands and sent samples to a foreign laboratory for further analysis. The lab found high fluoride levels in the liver, spleen, kidney and muscles, proving that fluoride had indeed been accumulating in the soft tissue of the animals – and suggesting that this may be an ongoing issue.

She wrote to the Minister of Environment in spring 2012, and later also to the Minister of Industry and Innovation. Finally in autumn 2012 she was able to meet with both of them and explain her situation in detail. She told Saving Iceland that the two ministers listened to her and resolved to further investigate the matter. They have now appointed two experts to look into the matter in more depth.

In an article on her website (Námshestar), published last autumn, Ragnheiður tells her story in detail through the whole period of her dealings with the authorities, from the moment she first noticed the horses’ illness up until the day of the article’s publication. Her conclusion is the following:

I have fought for in-depth research of the horses and their environment for a few years. Eventually, I was forced to do it myself. After the findings of tests on several biological specimens (monitoring that neither Iceland’s Environment Agency nor MAST were willing to conduct) I believe there to be a well-grounded suspicion that the horses are suffering from a metabolic disease (equine metabolic syndrome) as a result of too much fluoride in grass and hay. In addition to causing calcium deficiency in blood and damaging both teeth and bones, fluoride also impacts the activity of the thyroid which operates the body’s metabolism. Fluoride also wears away magnesium and other important substances.

Regarding her dealings with the authorities, she concludes by stating that her experience through the last years has taught her “not to expect important affairs to receive speedy and conscionable process within public administration in Iceland.” In particular she points out how the local authorities have actively ignored repeated warnings about pollution from the Grundartangi industrial complex and appear to be working for the interests of the industry rather than the people. This fits in with the Icelandic government’s original invitation to energy intensive heavy industry in 1995, which was entitled ‘Lowest Energy Prices!’ and promised ‘a minimum of red tape’ on environmental clearance for foreign industrial companies setting up in Iceland.

More Industry: More Pollution: Less Democracy

Century Aluminum (Norðurál) are supposed to measure fluoride levels around their Grundartangi plant, but according to local nature-protection organization, Umhverfisvaktin við Hvalfjörð (Hvalfjörður Environment Watch), the company stops monitoring the wider local area during the winter months – when pollution hangs in the fjord and is more intense – and, instead, only monitor fluoride levels right at the edge of the smelter, thus distorting the annual figures.

In 2011, Saving Iceland reported on the plans to expand the industrial area at Grundartangi in Hvalfjörður in order to house more polluting industries on top of the already existing ferro-silicon and aluminium plants. Despite more than 70 letters of opposition by local farmers, summer hut owners and others, the local authorities have accepted the planned expansion on behalf of the community. In one of these letters, Umhverfisvaktin pointed out that no proper assessment has yet been made regarding increased industrial pollution in the fjord and its environmental and livestock impacts. In response, the local authorities stated that there was no evidence to suggest that this should be taken into account.

The Most Environmentally Sensitive Smelter in the World!

In the beginning of last February, MAST published a report emphasizing the importance of monitoring the impacts of fluoride pollution in Reyðafjörður. The report states that although current fluoride levels are below maximum levels, a blind eye should not be turned to the possibility that too much fluoride will later damage the dental hygiene of young animals currently grazing at the most polluted areas. As their glaze is taking shape during the period from birth until they obtain permanent teeth, fluoride in too high numbers can endanger the quality of the glaze and damage the teeth up to two years post the absorption. Therefore, MAST states, it’s important to examine the bones of slaughtering animals and monitor the teeth of lambs and young sheep, foals and young horses, calfs kept for breeding, heifers and young dairy cattle – increasing both monitoring as well as the sampling locations.

One of the farms affected by fluoride pollution in East Iceland is Kollaleira, where local farmer Guðmundur Beck famously opposed the giant Alcoa smelter, claiming it would destroy the fjord he knew and loved. Guðmundur spoke to us about the recent pollution incident:

The news about fluoride pollution in Reyðarfjörður last autumn was just what had been warned of all the time, although I admit that it happened a few years earlier than I expected. Alcoa is trying to excuse this event as some kind of accident, when it seems to be a clear case of negligence. It certainly doesn’t fit with the widespread propaganda about “the most environmentally sensitive aluminium smelter in the world” that Alcoa has continuously spread around East-Iceland.

This event clearly underlines the profligacy of the aluminium industry and of the Icelandic authorities that allowed their operation. The experience from other smelters here in Iceland shows that it doesn’t matter how much they pollute – the companies are never fined or punished in other ways for breaking their operating license. And their operation is never amended.

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1.  Christopher Bryson, 2004. The Fluoride Deception. Seven Stories Press.

There is a photograph by Richard Peter of a statue of an angel overlooking the card-house-like ruins of Dresden. During three days in February 1945, the German city was annihilated by the allied forces using a new firestorm technique of simultaneously dropping bombs and incendiary devices onto the city.

The photo resonates with philosopher Walter Benjamin’s essay ‘On the Concept of History,’ in which he adds layers of meaning to a painting by Paul Klee titled ‘Angelus Novus’. Benjamin describes Klee’s angel as ‘The Angel of History’ whose face is turned towards the past. “Where we see the appearance of a chain of events, he sees one single catastrophe, which unceasingly piles rubble on top of rubble and hurls it before his feet.”

Wanting to “awaken the dead and to piece together what has been smashed,” the Angel’s wings are stretched out by a storm from Paradise, which “drives him irresistibly into the future, to which his back is turned, while the rubble-heap before him grows sky-high.”

“That which we call progress,” Benjamin concludes, “is this storm.”

Can You Stand in the Way of Progress?

If the storm disenables us to fix the ruins of the past, what about preventing the storm from blowing? That would not be so simple according to art collective Angeli Novi, comprised of Steinunn Gunnlaugsdóttir and Ólafur Páll Sigurðsson, whose exhibition is currently showing at The Living Art Museum (Nýló).

Under a confrontational title — ‘You Can’t Stand in the Way of Progress,’ shaped as the ‘Arbeit Macht Frei’ sign of Auschwitz — Angeli Novi have greatly altered the museum’s space with an installation of sculptures, soundscapes, smells and videos, including a 20-minute film of the same title as the exhibition. The film is a kind of kaleidoscopic time machine, examining the plight of generations which, one after the other, become tools and puppets of economic and historical structures.

In a well-cooked and stark manner — adjectives borrowed from Nýló’s director Gunnhildur Hauksdóttir — often shot through with streaks of black humour, the exhibition displays a dark image of Western civilization via versatile manifestations of the horrors embedded in capitalism, industrialism, nationalism, religion, the dualistic and linear thought of occidental culture, and the individual’s buried-alive position in society.

The metaphor here is literal as the only visible body-parts of the film’s thirty protagonists are their heads. The rest are buried under ground. Between themselves, their chewing mouths fight over ceremonial ribbons carrying a collection of Western society’s fundamental values, doctrines and clichés, in a dynamic collision with a collage of significant images behind them — “the history of Western thought,” as author Steinar Bragi points out. Towering over a coffin shaped as a baby’s cot, located in a mausoleum at the museum’s entrance, the same ribbons have been tied onto a funeral wreath. A single cliché, “From the Cradle to the Grave,” hangs between the mouths of two children’s heads that stick out of the black sand below the coffin. A smooth corporate female voice greets the visitors: “Welcome to our world!”

I Sense, Therefore I Think

“It’s very pessimistic,” Steinar Bragi says during our conversation in a bunker-like room of Nýló. “The film shows us disembodied beasts, fighting over the phrases that our entire society is built upon. I always see the head as the rational approach to life, stuck in these dualistic pairs that are so far from reality as I experience it. We have sensibilities, then emotions, and finally there are words and reason. Reason is useful for certain tasks, when one has to go from place A to place B, but it’s only a tool to be used on something far more extensive.”

Steinar and I agree that society is constantly simplified into Cartesian dualism — “I think, therefore I am” — the ground zero of Western thought. And while dualism doesn’t necessarily reject sensibilities and emotions, Steinar maintains that it locates reason on a higher level. “Reason is expected to control, which it certainly does in a small and unglamorous context, but it’s only an expression of what lies beneath.”

Enemies of Progress?

It’s clear that the core of this rationalism is simplification such as how political and social conflicts tend to be reduced to a fight between alleged good and evil forces. This not only brings us to the religious nature of the myth of progress, but also the power of language. Because “although they are hollow and empty and repeatedly chewed on, these phrases are also very powerful,” as literary scholar Benedikt Hjartarson points out. “They conduct the way society is shaped. They manifest the social and economic reality we live with.”

As former director of US aluminium corporation Alcoa Alain Belda told the newspaper Morgunblaðið in March 2003: “Some people are against progress.” He was referring to the opponents of the Kárahnjúkar dams, constructed in Iceland’s highlands to create energy for Alcoa’s smelter. “But fortunately,” he continued, “the world is growing and people are requesting better lives.”

Such an argument equals economic growth and people’s welfare, portraying the megaproject’s opponents as enemies of progress. At the same time it negates the destructive nature of progress, manifested for instance in the culturally genocidal impacts — in the form of displacement of populations — and irreversible environmental destruction often associated with large-scale energy production, and how the lives of whole generations are wasted by wars waged for power and profit.

“We see this contradiction within modernity,” Benedikt continues, “how the idea of progress thrives on destruction and always calls for annihilation.” But unlike the revolutionary destruction encouraged by 19th Century anarchist philosopher Michail Bakunin — who stated, “the passion for destruction is a creative passion too!” — the annihilation inherent to progress is rather used as a stimulus for an unaltered continuum of the status quo under the pretext of development. Thus, the contradictory nature is evident again, as well as the religious one: “The present is never here,” Benedikt says, “it’s always something we are aiming for.”

Violence Intrinsic to Social Contracts

The film displays a great amount of violence, which musician Teitur Magnússon sees with a strong reference to alienation. “One feels like it’s somehow supernatural, like it’s not the work of humanity but rather of a monster that’s eating everything up, and we don’t seem to have any control of it.”

Artist Bryndís Hrönn Ragnarsdóttir furthermore connects this brutality with authority. “Humans aren’t able to handle more power than over themselves,” she says. “As soon as someone is granted higher power, violence enters the picture.” She maintains that some sort of violence is intrinsic to all simplifications — “all of society’s attempts to try and settle upon something” — meaning a wide range of social contracts, from organized religion to written and unwritten rules regarding people’s behaviour.

A Leap Into the Future

As Angeli Novi’s subject is not only complex but also polarized — layered with our cultural history of construction and destruction, repression and revolt — the exhibition doesn’t preach any simple solutions to the great problems it addresses. Such attempts are often just as contradictory as the myth of progress itself, or as philosopher Slavoj Žižek ironically sums up in his analysis of what he calls ‘a decaf reality,’ when the “very thing which causes damage should already be the medicine.”

Thus, one cannot resist wondering if there actually is a way out of the horrors analysed and manifested in the exhibition. Or is humanity bound to be stuck in a premature burial while the seemingly unstoppable catastrophe witnessed by Benjamin’s Angel of History keeps on enlarging into eternity?

With images referring to France’s July Revolution of 1830, Angeli Novi reject such a vision and suggest instead a peculiarly creative approach to revolt. Already during the revolution’s first day, clocks on church towers and palaces all over Paris were shot down and destroyed, signifying the urgent need to nullify predominant social structures and ideologies by putting an end to the time of the oppressors.

In continuum of this rebellious tradition of what philosopher Herbert Marcuse referred to as “arresting time” — directly related to what William Burroughs called “blowing a hole in time” — Angeli Novi transcend the well known demand for “all power to the people” with a leap into the future, granting wings to the mind and calling for all power to the imagination.

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See also:

Saving Iceland: Kárahnjúkar Dam Blown Up in New Film by Angeli Novi

Jón Proppé: Standing in the way of progress

Þóroddur Bjarnason: Jafnvægislist (Icelandic only)

Angeli Novi’s webiste

At the heart of the exhibition, which consists of audio, video and sculptural pieces, is a 20 minute long film in Icelandic and English, bearing the same title as the exhibition. Around 30 people were willingly buried alive during the making of the film, which was shot this year in Greece and Iceland. Soundscapes were created by Örn Karlsson in collaboration with Angeli Novi.

Corporate green-wash and the Kárahnjukar dams play a key role in You Can’t Stand in the Way of Progress. In one of the film’s scenes, the 700 m long and 200 m high central Kárahnjúkar Dam is digitally blown up by the very same explosion that blew up the Dimmugljúfur canyon in March 2003. The first destruction of the 200m deep canyon, which was carved out by the 150 km long river Jökulsá á Dal, played a strategical key role in the conflict about the power plant’s construction, and was meant to signify the government’s determined intention to steamroller Iceland’s eastern highlands in order to produce electricity for the US aluminium corporation ALCOA. As environmentalists warned from the beginning, the construction has turned out to have devastating environmental, social and economical impacts, and contributed also heavily to Iceland’s infamous 2008 economic collapse.

Asked about the cinematic blast, artists Gunnlaugsdóttir and Sigurðsson said: “It was particularly pleasurable to blow up the image of the dam that has now become the main symbol of corporate power abuse and ecocide in Iceland.” Sigurðsson  added that it was “Very appropriate to use for our purpose the same film footage that was used by the Icelandic government in 2003 to dash people’s hopes of saving the Kárahnjúkar area from deeply corrupt forces of corporate greed and governmental stupidity. These same forces have learnt nothing from their past crimes and mistakes and are now lining up for taking power next year in order to continue their destructive rampage through Icelandic nature.”

A press release  from The Living Art Museum states the following:

Angeli Novi create a kind of a kaleidoscopic time machine, examining the plight of generations which, one after the other, become tools and puppets of economic and historical structures. Through symbolism and imagery, Angeli Novi examine the ideological backdrops of these structures, the variously substance-drained core values of occidental culture, as well as as the reoccurring themes of doctrines and clichés in the societal rhetoric, necessary for society to maintain itself.

You Can’t Stand in the Way of Progress opened on 29 September and will run until 2 December. The Living Art Museum is located on Skúlagata 28, 101 Reykjavík.

But who are the faces behind Alcoa? From big pharmaceutical chiefs, to Bilderberg attendees, Iraq profiteers and a Mexican president, Alcoa’s board remains one of the most influential and shadowy of the mining and metals companies. Use the links to Powerbase’s profiles in this article to find out more.

Current Alcoa CEO Klaus Kleinfeld has been an Alcoa board member since 2003. He is also a director of Bayer, the pharmaceuticals and chemical company which grew out of the Nazi company IG Farben, responsible for the medical experiments at Auschwitz. Bayer is now famous for it’s GM and crop science business and was named one of 10 Worst Companies of the Year by Multinational Monitor in 2001. Kleinfeld is associated with all three of the most influential and private ‘global planning groups’. He attended the Bilderberg conference in 2008 and is a member of the Trilateral Commission and Director of the International Business Council of the World Economic Forum. He is also a Director of the Brookings Institution, one of the USA’s biggest think tanks, and the third most cited in Congress.

Kleinfeld was CEO of Siemens from 2005 to 2007 after spending 20 years with the company. He resigned amid a corruption scandal which saw the US Department of Justice investigating the company for charges of using slush funds of €426m (£291m) to obtain foreign contracts, and funding a trade union to counter existing Union action against them. Kleinfeld resigned just hours before the news broke to the media. In 2009, after a lengthy investigation, Kleinfeld and four other executives were forced to pay large compensation sums. Kleinfeld allegedly paid $2 million of the $18 million total collected from the five, though he still denied wrongdoing. Kleinfeld is also on the boards of the finance giant Citigroup and the U.S Chamber of Commerce.

Former Mexican President Ernesto Zedillo has been on Alcoa’s board since 2002, and chairs the Public Issues Committee. Zedillo is a prominent economist and another member of the big three elite think-tanks sitting on the World Economic Forum and the Trilateral Commission with Kleinfeld, and attending the Bilderberg conference in 1999. Like Kleinfeld he is also a director of Citigroup. Zedillo also sits of the International Advisory Board of the Council on Foreign Relations, an American foreign policy think tank based in New York City who carry out closed debates and discussions and publish the journal Foreign Affairs. CFR played a significant part in encouraging the war on Iraq, and helped plan it’s economic and political aims alongside the US Government, particularly how to gain oil contracts after the war. He directs the Club de Madrid, a right-wing/neoliberal focused group of former government officials, think tankers and journalists involved in pushing reactionary policies to terrorism (referring to the Madrid bombings).

Mr. Zedillo was Mexican president from 1994-2000. He was appointed by Secretary General Kofi Annan to be the United Nations Special Envoy for the 2005 World Summit, and chaired the World Bank’s High Level Commission on Modernization of World Bank Group Governance in 2008. He is a director of JPMorgan-Chase, Proctor and Gamble, BP, Rolls Royce and an advisor to the Bill & Melinda Gates Foundation. He directs the Center for the Study of Globalization at Yale University, which puts out influential reports and papers edited by him.

A fellow member of the Council on Foreign Relations is Alcoa board member E.Stanley O’Neal. O’Neal is a Harvard graduate and investment banker who served as CEO of Merrill Lynch from 2002 to 2007 and is a director of the New York Stock Exchange (now NYSE Euronext), the Nasdaq Stock Market and BlackRock – a key investor in the mining and metals industry. According to Forbes he was awarded $22.41 million in 2006. Mr O’Neal is also a trustee of another shady organisation, the Center for Strategic and International Studies, a private group led by John J. Hamre, former deputy secretary of defence which ‘provides world leaders with strategic insights on — and policy solutions to — current and emerging global issues’. CSIS provided propaganda materials used by the CIA to destabilise the Government of Chile in the run up to the 1973 coup.

A third Council on Foreign Relations member sits on Alcoa’s board. James W. Owens is Chairman of the Business Council of the CFR, CEO and Executive Chairman of Caterpillar from 2004 to 2010 and Alcoa board member since 2005. Caterpillar are famous for their tendency to profit from war-induced contracts including in Israel and Iraq, just the sort of thing that the Council on Foreign Relations are interested in. Owens is also a director of the International Business Machines Corporation and Morgan Stanley and a senior advisor to Kohlberg Kravis Roberts & Co, a global asset manager working in private equity and fixed income.

Indian mega magnate Ratan Tata has been a director of Alcoa since 2007 and is currently a member of the International Committee and Public Issues Committee. He chairs Tata Sons, holding company for the Tata Group, the family business which is one of India’s largest business conglomerates including telecoms, transport, tea and now one of the biggest steel companies in the world after they bought Corus outright in 2007. As well as his directorships of most of the Tata companies, he is also a a former director of the Reserve Bank of India, and advisor to NYSE Euronext (the New York Stock Exchange), and JP Morgan – one of the largest shareholders of the London Metal Exchange who set metal prices worldwide and enable banks to stockpile and futures trade aluminium. Mr Tata is also trustee of Cornell, Southern California, Ohio State, and Warwick Universities, a director of the Ford Foundation and a member of the UK Prime Minister’s Business Council for Britain.

A fellow member of the Ford Foundation, and Saving Iceland favourite most-wanted, is Kathryn Fuller. Ms Fuller chaired the Ford Foundation from 2004 to 2010 and has been a trustee since 1994. However she is most famed for her contradictory positions as World Wildlife Fund (WWF) Chief Executive (1989-2005) and Alcoa board member (since 2001). Newspaper Independent on Sunday claimed she joined Alcoa in exchange for a $1m donation to WWF US and allowed Alcoa to join WWF’s exclusive “Corporate Club”, a claim Fuller has found hard to refute. Despite publicly opposing the highly controversial Fjarðaál smelter project, Fuller abstained rather than voting against the project in Alcoa’s boardroom. Elsewhere she has claimed that Alcoa holds “a strong commitment to sustainability, including energy efficiency, recycling, and habitat protection.”

Compared to these heavyweights Alcoa’s other current board members may look like small fry, but they still command an impressive and worrying influence across a number of boards.

Sir Martin Sorrell is founder and chief executive officer of the £7.5 billion communications and advertising company WPP. He has been a NASDAQ director since 2001 and was appointed an Ambassador for British Business by the Foreign and Commonwealth Office. Before founding WPP, Martin Sorrell led the international expansion of famed UK advertising agency Saatchi and Saatchi. He calls himself ‘a money man’ saying: “I like counting beans very much indeed”.

Arthur D. Collins, Jr. is a big pharmaceuticals boss. He is retired Chairman and Chief Executive Officer of Medtronic Inc. who he had been with between 1992 and 2008, and previously Corporate Vice President of Abbott Laboratories from 1989 to 1992. He also sits on the boards of arms manufacturers – Boeing, and bio-tech giant Cargill.

Michael G. Morris has been Chairman, President and Chief Executive Officer of all major subsidiaries of American Electric Power since January 2004 having been a company executive since 2003. He is also a Director of the USA’s Nuclear Power Operations and the Business Roundtable (chairing the Business Roundtable’s Energy Task Force) as well as the Hartford Financial Services Group. He was listed 158th on the Forbes Executive Pay list in 2011 and received a total $9 million in 2010.

Finally, Patricia F. Russo, is a Director of asset management group KKR & Co, General Motors, Hewlett Packard and drug manufacturers Merck & Co, who’s arthritis treatment Vioxx induced heart attacks and sudden cardiac deaths in 27,000 people between 1999 and 2004. Merck were exposed for trying to bury negative evidence and distort drug trials to hide the known cardiovascular effects of Vioxx. Litigation following the scandal is ongoing and will be part of the business of Ms Russo.

Coming back to Iceland there is another former director of note. Norwegian national Bernt Reitan was Alcoa Executive Vice President from 2004 to 2010 and a director of iron alloy and silicon company Elkem from 1988 to 2000, putting him in the centre of the development of Iceland’s Hvalfjörður Elkem plant, and the Fjarðaál aluminium smelter. Elkem subsidiary Elkem Aluminium was sold to Alcoa in 2009. Reitan broke the ground at the massive Fjarðaál smelter in Reyðarfjörður in 2004 alongside Valgerður Sverrisdóttir, then Minister of Industry, and Guðmundur Bjarnason, Mayor of Fjarðabyggð. In view of his influential position in Iceland Reitan sits on the Icelandic-American Chamber of Commerce which was formed by the Iceland Foreign Trade Service in New York and promotes trade between Iceland and the USA.

Mr Reitan is also a Director of the International Primary Aluminium Institute and a former board member of the European Aluminium Association as well as Royal Caribbean Cruises Ltd, Yara Internation ASA and Renewable Energy Corporation ASA.

The combined power of these Alcoa Directors reaches deep into the political and corporate structures of the USA and Europe. In this light it is a mean feat for Alcoa to be ejected from Húsavík, but we can be assured that Alcoa’s aluminium claws are still dug in deep in Iceland – a small country with such cheap and abundant hydro power. 

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For more information on Powerbase’s mining and metals research please visit the Mining and Metals portal and peruse the aluminium industry profiles.

See other key figures in Iceland’s heavy industrialisation at our Hall of Shame.

Notes and References:

[1] The terms “greenfield” and “brownfield” are used by the aluminium industry, and though the former might give an image  of a “green” and less environmentally damaging construction than the latter, the meaning is in fact the absolute opposite. Samarendra Das and Felix Padel explain the difference: “While a brownfield project renovates or adds to an existing plant […] “greenfield” has a more attractive ring to it, but what it means is turning an area of green fields and forest brown as the area is cleared and polluted…” See: Samarendra Das and Felix Padel. 2010. Out Of This Earth – East India Adivasis and the Aluminium Cartel. Orient Black Swan. India. p. 336.
[2] Esmarie Swanepoel, 11 Jan 2011 ‘Alcoa Posts $21bn revenue in 2010′. Mining Weekly. Accessed 22/02/2012.
[3] Icelandic-American Chamber of Commerce, Statistics. Accessed 22/02/2012.

See also:

From Siberia to Iceland: Century Aluminum, Glencore and the Incestuous World of Mining – A special report for Saving Iceland by Dónal O’Driscoll, about the people and crimes behind Glencore International and Century Aluminum, which runs the Hvalfjörður smelter mentioned in the article above and fantasize about operating another one in Helguvík.

On May 21, however, DV published an interview with Þórhallur Þorsteinsson, one of the people from Eastern Iceland who had the courage to oppose the construction. In the interview, which turns Janne’s claims upside down, it emerges how heavy the oppression was in the East during the preamble and the building of the dams and smelter was — people where “oppressed into obedience” as Þórhallur phrases it. He talks about his experience, loss of friends, murder threats, the attempts of influential people to dispel him from his work, and the way the Icelandic police — and the national church — dealt with the protest camps organized by Saving Iceland, which lead him to wonder if he actually lived in a police state.

Þórhallur Þorsteinsson is one of the people from Eastern Iceland who protested against the construction of the Kárahnjúkar dams. For that sake, he was bandied about as an “environmentalist traitor”, accused of standing in the way of the progress of society. Influential people attempted to dispel him from his job, he had to answer for his opinions in front of his employers, and his friends turned against him. The preparations for the construction started in 1999, but the construction itself started in 2002. The power plant started operating in 2007 but the wounds have not healed though a few years have passed since the conflict reached its climax.

“There are certain homes here in Egilsstaðir that I do not enter due to the conflict. Before, I used to visit these homes once or twice a week. I am not sure if I would be welcome there today. Maybe. But in these homes I was, without grounds, hurt so badly that I have no reason to go there again. Now I greet these people but I have no reason to enter their homes. I was virtually persecuted,” Þórhallur says, sitting in an armchair in his home in Egilsstaðir.

His home bears strong signs for his love of nature, his bookshelves are filled with books about the Icelandic highlands, nature and animals. For decades, Þórhallur has travelled in the highlands and did thus know this area [the land destroyed by the Kárahnjúkar dams] better than most people. “I had been travelling in this area for decades. I had gone there hiking and driving and I have also flown over it. I went there in winters just as in the summers. I went there as a guide and I knew the area very well. So I am not one of those who just speak about this area but have never got to know it.”

Not only did he know the land but also cared for it. He was hurt to see it drowned by the reservoir and has never managed to accept its destruction. “I am immensely unhappy with everything regarding this project. The dams, the [Alcoa] aluminium smelter, the environmental impacts, and additionally, it has not brought us what was expected. Thus I find hardly anything positive about this,” Þórhallur says.

“The sacrifice of this part of the highlands, the environmental impacts of these constructions, just can not be justified. Waterfalls by the dozen, many of them extremely beautiful, are rapidly disappearing and are just about waterless. A highly remarkable land went under water, under the reservoir, for instance Hálsinn which was the main breeding ground for reindeer. Additionally, this was the only place in Iceland with continuous vegetation from the sea, all the way up to the glacier. This has now be interrupted by Hálslón [the reservoir].”

The Resistance in the East

During the journalist’s trip around Eastern Iceland, many of the locals spoke a lot about how artists from 101 Reykjavík [the center of the city] protested against the construction. Þórhallur, however, points out that the original resistance against the project was formed in the local region. “People tend to forget this fact all the time, as they only speak about 101 Reykjavík. Before the conflict started, an association for the protection of Eastern Iceland’s highlands was founded here. It was founded with the purpose of opposing the construction — Kárahnjúkar had not even entered public discussion at that point although we, of course, knew about it.”

About thirty people joined the inaugural meeting and agreed upon the importance of such an association. Soon, a few people left the organization. “Those who had an opposite opinion compared to what people generally thought about the project were oppressed. The picture was painted in a way suggesting that the residents of Eastern Iceland should stand together. The rest of us, who were against the project, were not considered true members of this society. And we were not good citizens at all. In people’s minds, we were traitors. We were the people who wanted to send people back to the turf huts, as they used to say. We were said to be against development, against creating a good future for our children. All this was thrown at us, that the children would not come back home after studying, that they would not get any jobs. By opposing the construction, I was, in these people’s minds, taking away their children’s future livelihood, preventing the creation of jobs, and lowering real estate prices here in the east. I got to hear all of this. This is how it was.”

The First Protests

At a certain point, the verbal abuse was taken further than can be considered normal. “My life was threatened. A man that I used to work with met me in the street and said that I ought to be shot. Of course, it was painful to live through this, it hurt because they were trying to oppress me. They personified the issue so they could portray me as if I was taking something away from people, as if I was preventing the people here from living an ordinary life. This was the attitude.

I have lived here since I was a little kid and from early age I have been contributing to this community. I have partaken in building it up, socially and as an individual. I have been here all my life. Despite my opposition to this construction, I did not consider myself being any less of a member of this community. Nothing of what I have done justifies the accusations of me wanting to ruin this community. I was simply against this construction. But just like others, I was to be suppressed into obedience.”

Despite all this, Þórhallur refused to throw away his ideals and stay silent. Determined not to be silenced, he continued his fight with both words and actions. “I am probably the only resident in Eastern Iceland who ever has been fined for opposing the Kárahnjúkar dams [in fact Gudmundur Mar Beck, farmer at Kollaleyra in Reydarfjordur (site of the ALCOA smelter) was also fined a hefty sum for protesting against the project. Ed. SI.org]. Along with others, I blockaded a bridge over river Besstastaðaá and was fined,” he says and adds that he did happily pay the fine. “This action was symbolic for the situation at that time, as a token of the fact that the case had become insolvable. We didn’t intend to completely prevent these people from continuing their way,” Þórhallur says. These people were the board of Landsvirkjun [Iceland’s national energy company] as well as Ingibjörg Sólrún Gísladóttir, then mayor of Reykjavík [later Minister for Foreign Affairs in the government that was toppled by protesters during the winter of 2008-9], and the area that was at stake at that time was Eyjabakkar wetlands. “We read two statements out loud, from the Association for the Protection of Eastern Iceland’s Highlands, and after that the protest was over.”

He does not regret this, even though he had to face the consequences his actions. “I was there in my spare time but at this time I worked for the The State Electric Power Works. Following the protest, we witnessed one of the worst witch-hunting periods in the history of Eastern Iceland. The severity is very memorable to me.”

Harsh Attacks

This protest had been organized by Þórhallur as well as Karen Egilsdóttir, who was an elementary school teacher, and Hrafnkell A. Jónsson, who has now passed away. “Parents phoned the school’s headmaster and demanded that their kids would not have to go to her classes. Politicians in the East systematically tried to get me fired from my job. They phoned both the State’s and the Region’s electric utility directors, demanding that I would be fired because of a thing I did in my spare time. These same men constantly interrupted the Chairman of RARIK [Iceland State Electricity] and I had to stand up for my opinions. I had to show up in front of the Region’s electric utility director and proof that I had been at the protest during my spare time. And as my words were not enough, I had to get my supervisor to come and proof it. Everything was tried. It was harsh.

And when I was informed that very influential people in the East, respected members of their society, were trying to get back at me and get me dispelled from work because of my opinions, I got a very strange feeling regarding what kind of a society I live in.

I also witnessed the behaviour of the police who chased protesters around the highlands, which made me wonder if I lived in a police state. The police tried to prevent protesters from resting by putting wailing sirens on during the middle of the nights, they constantly drove past them and around their cars, took photographs during darkness using flash, and blocked roads so that people could not bring them food. I saw all of this taking place.”

Always Knew of More Opponents

For two years in a row, the protesters set up camps in the highlands. During the first summer [2005], the protest camp was pitched on a land owned by the Bishop’s Office. “The church’s tolerance was not greater than so that the Bishop’s Office asked for the protesters to be removed. The second year I brought them food by taking an alternate route to their camp when the police had closed the main road. I supported these people because they were doing a job that many of us here, the locals, could not do. They were protesting against something that very few people from the East felt up to, due to the way those who dared to protest were treated. We were monitored and the word, about what kind of a people we were, was spread around. That is the reason why many people contacted me, people who otherwise did not dare to voice their opinion, did not dare to join the struggle. I always knew that I spoke on behalf of more people than just myself.”

Thus, when Saving Iceland contacted Þórhallur, he was more than willing to help. He was a spokesperson of the Icelandic Touring Association and explained to Saving Iceland that it would be just about impossible to expel them from the camping area at Snæfell, which had been open to the public for many decades. Eventually, a ten days long camp was to be set up there. “Then the word started to spread and I received a phone call from the Bishop’s Office, asking me if we could stop the camp from taking place. I told them that this camping area had been open to the public ever since the hut was built, but I invited them to come to the East and try to expel them themselves. A few days later, Landsvirkjun’s public relation manager called me and brought up the same thing. He asked about the possibility of putting a limit on the amount of people allowed to stay at the camp, if the health and safety authorities would agree upon this amount of people, etc. etc. I told him the same: “This is an open camping area and we do not choose who gets to stay and who not.” You get the picture of how the situation was at this time.”

Not everybody was happy within the Touring Association. “Some of the board members were against it and conflicts took place within the association. I asked them what they intended to do, if the Association would then, in the future, pick out people allowed onto the camping areas. I said to them: These people just enter the camping area, follow the current rules and pay their fee. While so, we can not do anything. Then, some of the people realized how far they had stepped over limits.

So the protesters came to Snæfell and stayed for ten days. That worked out pretty well but then they went to other places [within the intended reservoir. Ed. SI] and came up against all sorts of misfortunes.”

A Protection Cancelled

He also points out how politicians behaved in the Kárahnjúkar issue. “It is interesting to look at the current discussion about the Energy Master Plan. Some people now say that politicians are interfering with specialists’ work. In that case, it is worth remembering the fact that the Kárahnjúkar dams were removed from the Master Plan and were only briefly considered in that context. Those who decided this were politicians. The project underwent an Environmental Impact Assessment and Iceland’s Planning Agency rejected it due to the drastic and irreversible environmental impacts. But then the case was simply taken into a political process and soon it was decided to go ahead and build the dams, despite the Planning Agency’s view that the environmental impacts were unacceptable.

The way this case was handled should actually be an ample reason for an investigation. This area’s official protection was cancelled so the land could be drowned. Never before had this happened in Iceland, but it was nevertheless done by Siv Fiðleifsdóttir, then Minister of the Environment. That is her monument: being the one Minister of the Environment, responsible for the most severe environmental destruction,” Þórhallur says plain-spoken.

The Old People Got Away

He believes that only the further damming of Þjórsárver wetlands would have been a even bigger environmental sacrifice. “Thereafter came Kárahnjúkar. But this is all about politics, Icelanders have no time for politics. The Danes have done fine without heavy industry. This is always just a question of a political policy, and for decades, the inhabitants of Reyðarfjörður [where the Alcoa smelter is located] have been promised that someone will come and do something for them. In such a position, people tend to forget their survival instinct.

The exchange rate was way too high and all the local fishing industry left. Fishing company Skinney Þinganes moved all their business to Höfn in Hornafjörður, while Samherji [another seafood company incidentally owned by the family of Halldor Asgrimsson, one of two main perpetrators of the Karahnjukar dams] bought fishing quota from Stöðvarfjörður and Eskifjörður and took it away from there. But because an aluminium smelter was on its way, people believed that this was no problem. It is always possible to starve people into obedience. It is easy to change the mentality in such a way that it simply receives. All of a sudden the smelter appeared as some sort of a life buoy. The positive side of it is that now there are much younger people living in Fjarðabyggð [combined municipality of a few towns, including Reyðafjörður] than before. The old people got away. But behind this is the sacrifice. The sacrifice was too big and it was the whole region’s sacrifice. We sacrificed this for the benefits of a North American corporation. We sacrificed everything for too little. While all this took place, people were supposed to stand together and they spoke about the region as a totality. But immediately as the construction was over, all such solidarity disappeared.”

Direct and Indirect Payments

He is, nevertheless, able to understand why the region’s people were in favour of the construction and focused on getting a smelter. “I understand them very well, as they got something out of it. But it is clear that we got too little. 200 people from here work in the smelter, I think. 200 jobs — that is not enough for such a sacrifice. 500 jobs would also not have been enough when compared with the land that was destroyed. But people can be bought up if they are handed money. And I understand farmers who had never seen any real money but were all of sudden promised amounts which they would, in any other case, not have been able to even dream of. But is that the way we want it to be? That people can be mislead by money?

If they would have stood their ground and rejected all of , if the Fljótsdalshérað region would have rejected this, and the local politicians and the public — then this would never have become true. Now, some people state that we never had anything to say about it, but these are people who have a bad conscience because they did not fight against the construction.

Everywhere in the world, except Iceland, these “counterbalance steps” as they are called, would have been considered bribery. Basically, local politicians were bought up. Farmers and influential people were hired on good salaries and farmers got fertilizer to use on uncultivated land. All such indirect payments to influential people certainly have an impact on what decisions are made and on what premises they are made. Some farmers received compensation due to the destruction, but to pay compensation to only one generation is not acceptable. It would have made much more sense to link the compensation with the power plant’s electricity production and pay them to those living in the area on an annual basis.”

Gullfoss Falls Could be Forgotten

Asked about the actual value of the land now lost, Þórhallur answers: “This land used to be an attraction. The waterfalls that have now dried up, the vegetated land that went under water, the wilderness which is becoming increasingly precious. Being able to live with such quality is like nothing else. If well organized, hundreds of thousands of travellers could have been been shown this land without the land being harmed. Seen from a long-term perspective, that could have created more money than the dams.”

Think about the fact that the Gullfoss waterfalls and the hot spring Geysir did not use to be popular tourist places. It was not easy to get to them, say fifty or hundred years ago. We can not sacrifice something just because only a few people know about it. Using that same argument, we could as well dry up Gullfoss, as in a few decades we would forget about it and the next generations would not know what a beautiful waterfall used to flow there. We can not think in that way. One generation can not treat Iceland’s nature, this national treasure, in such a way.

I first drove to Hafrahvammar canyon in 1972 and, in fact, roads and paths have been there for many decades, but they were quite difficult to pass. That could easily have been changed and thus, the access to the area could have been increased.”

“The Same Horrific Situation Far and Wide”

In the end he says that the aluminium smelter has not lived up to society’s expectations. “It still has not been possible to staff the smelter with Icelanders. Only Icelandic-speaking people are hired there but despite all the unemployment and all the advertising, sub-contractors partly staff their companies with foreigners, as Icelanders are not willing to take on these jobs. The labour turnover has been about 25 percent. Despite the fiasco the nation has went through [the 2008 economic collapse], this is not considered a decent option for a working place.

Was the hole purpose of drowning this land, destroying this nature, drying up these waterfalls, to be able to import migratory workers from abroad? Do some of the unemployed people on Suðurnes not want to come to the East, move into all the empty apartments and work in the smelter in Reyðarfjörður? Isn’t there something wrong? Why do people not apply for jobs here?” Þórhallur asks and adds that the pot-rooms and the cast-house are not really desirable workplaces, though some other jobs in the smelter might lure some. “One has to work 12 hours shifts and I know no-one who works in the smelter and looks at it as their future job. I also know people who used to work there but quit because of the long shifts. They did not want to sacrifice their family life for the job. People will work there until they find a better job. If the economy recovers in a few years time, how will this end? Will we end up having to staff the smelter solely with foreign labour on season?

This was supposed to save everything but the same horrific situation is evident far and wide. The smelter had, for instance, no positive impacts in nearby places like Stöðvarfjörður and Breiðdalsvík.

The planned population increase in Eastern Iceland never took place, and as the senselessness was absolute, everything collapsed. No-one lives in the houses that were built — streets were laid but no houses built on them. The municipality is bankrupted, as it is expensive to go into such a construction and to sit up with this half-finished street-system. This situation might recover in a few decades, but it still was not worth it.”

This is the content of Saving Iceland’s first round of brief monthly news from the struggle over Iceland’s wilderness and connected struggles around the world.

Hellisheiði: Asthma, Sulphur Pollution and Effluent Water Lagoon

Those who promote large-scale geothermal energy production as green and environmentally friendly, are once again forced to face another backlash as a recent research suggests a direct link between sulphur pollution from the Hellisheiði geothermal plant and asthma among the inhabitants of Reykjavík. The results of this particular research, which was done by Hanne Krage Carlsen, doctorate student of Public Health at the University of Iceland, were published in the Environmental Research journal earlier this year, showing that the purchasing of asthma medicine increases between 5 and 10 percent in accordance with higher sulphur pollution numbers in the capital area of Reykjavík.

Adding to the continuous unmasking of the geothermal green myth, environmentalist Ómar Ragnarsson recently discovered and documented new lagoons, created by run-off water from Reykjavík Energy’s geothermal power plant in Hellisheiði. At first Reykjavík Energy denied that the lagoons’ water comes from the company’s power plant, but were forced to withdraw those words only a few days later. Ómar had then brought a journalist from RÚV, the National Broadcasting Service, to the lagoons and traced the water to the plant. Despite the company’s withdrawal, they nevertheless rejected worries voiced by environmentalists, regarding the very possible pollution of ground water in the area, and insisted that this is allowed for in the plant’s license.

According to the plant’s license the run-off water should actually be pumped back, down into earth, in order to prevent polluting impacts and the creation of lagoons containing a huge amount of polluting materials. Ómar’s discovery shows that this is certainly not the case all the time, and additionally, the pumping that has taken place so far has proved to be problematic, creating a series of man-made earthquakes in the area, causing serious disturbances in the neighbouring town of Hveragerði.

In an article following his discovery Ómar points out that for the last years, the general public has not had much knowledge about geothermal power plants’ run-off water, and much less considered it as a potential problem. Ómar blames this partly on the Icelandic media, which have been far from enthusiastic about reporting the inconvenient truth regarding geothermal power production. One of these facts is that the effluent water, which people tend to view positively due to the tourist attraction that has been made of it at the Blue Lagoon, is a token of a serious energy waste, as the current plants use only 13% of the energy while 87% goes into the air or into underutilized run off-water. These enlarging lagoons — not only evident in Hellisheiði but also by the geothermal power plants in Reykjanes, Svartsengi, Nesjavellir and Bjarnarflag — suggest that the energy companies’ promises regarding the pumping of run-off water, are far from easily kept.

The Fight Over Iceland’s Energy Master Plan Continues

During the last few weeks, the Icelandic Parliament’s Industries Committee received 333 remarks in connection with the committee’s work on a parliamentary resolution for Iceland’s Energy Master Plan. The resolution, which was presented by the Ministers of Industry and of Environment in April this year, gives a green light for a monstrous plan to turn the Reykjanes peninsula’s geothermal areas into a continuous industrial zone.

The remarks can generally be split into two groups based on senders and views: Firstly, individuals and environmentalist associations who, above all, protest the afore-mentioned Reykjanes plans. Secondly, companies and institutions with vested interests in the further heavy industrialization of Iceland who demand that the Master Plan’s second phase goes unaltered through parliament — that is, as it was before the parliamentary resolution was presented, in which the much-debated Þjórsá dams and other hydro power plants were still included in the exploitation category. Saving Iceland has published one of the remarks, written by Helga Katrín Tryggvadóttir, which differs from these two groups as it evaluates energy production and nature conservation in a larger, long-term context.

During the process, the head of the Industries Committee, Kristján Möller — MP for the social-democratic People’s Alliance, known for his stand in favour of heavy industry — ordered and paid for a remark sent by management company GAMMA. The company first entered discussion about one year ago after publishing a report, which promised that the national energy company Landsvirkjun could become the equivalent of the Norwegian Oil Fund, if the company would only be permitted to build dams like there is no tomorrow.

In a similarly gold-filled rhetoric, GAMMA’s remark regarding the Energy Master Plan states that the changes made by the two ministers — which in fact are the results of another public reviewing process last year — will cost Iceland’s society about 270 billion ISK and 5 thousand jobs. According to the company’s report, these amount are the would-be benefits of forcefully continuing the heavy industrialization of Iceland, a plan that has proved to be not only ecologically but also economically disastrous. Seen from that perspective, it does not come as a surprise realizing that the management company is largely staffed with economists who before the economic collapse of 2008 lead the disastrous adventures of Kaupþing, one of the three biggest Icelandic bubble banks.

Alterra Power: Decreases Revenue, Enlargement Plans in Iceland

Canadian energy company Alterra Power, the majority stakeholder of Icelandic energy company HS Orka, recently published the financial and operating results for the first quarter of this year. “Consolidated revenue for the current quarter was $16.4 million compared to $18.9 million in the comparative quarter,” the report states, “due to lower revenue from our Icelandic operations as a result of lower aluminium prices, which declined 13.9% versus the comparative quarter.”

At the same time, the company’s Executive Chairman Ross Beaty stated that Alterra is preparing for an enlargement of the Reykjanesvirkjun geothermal power plant, located at the south-west tip of the Reykjanes peninsula, which should increase the plant’s production capacity from the current 100 MW to 180 MW. The construction is supposed to start at the end of this year and to be financed with the 38 million USD purchase of new shares in HS Orka by Jarðvarmi, a company owned by fourteen Icelandic pension funds.

According to Alterra, permission for all construction-related activities is in place. However, as Saving Iceland has reported, Iceland’s National Energy Authority has officially stated their fears that increased energy production will lead to an over-exploitation of the plant’s geothermal reservoir. Furthermore, Ásgeir Margeirsson, Chairman of HS Orka, responded to Alterra’s claims stating that due to a conflict between the energy company and aluminium producer Norðurál, the construction might not start this year. According to existing contracts, the energy from the enlargement is supposed to power Norðurál’s planned aluminium smelter in Helguvík. That project, however, has been on hold for years due to financial and energy crisis, and seems to be nothing but a fantasy never to be realised.

Greenland: Cheap Chinese Labour and Toxic Dumping

The home rule government of Greenland is split in their stand on Alcoa’s plans to import 2 thousand Chinese workers for the construction of the company’s planned smelter in Maniitsoq. The biggest governing party, Inuit Ataqatigiit, is against the plan as the workers will not be paid the same amount as Greenlandic labour. On the other hand, the Democratic Party, which has two of the government’s nine ministerial seats, is in favour of the plans on the grounds that the workers’ working condition and payments will be better than in China.

In Iceland, during the construction of the Kárahnjúkar dams and Alcoa’s aluminium smelter in Reyðarfjörður, Chinese and Portuguese migrant workers were imported on a mass scale. More than 1700 work-related injuries were reported during the building of the dams, ten workers ended up with irrecoverable injuries and five workers died. In 2010, the Occupational Safety and Health Authority stated that the Kárahnjúkar project was in a different league to any other project in Iceland, with regard to work-related accidents.

At the same time as Greenland’s government argued over Alcoa, Danish newspaper Politiken reported that the Scottish oil company Cairn Energy — a company that, along with Indian mining giant Vedanta, shares the ownership of oil and gas company Cairn India — is responsible for dumping 160 tons of toxic materials into the ocean in the years of 2010 and 2011. The dumping is linked to the company’s search for oil off Greenland’s shore and is five times higher than the amount of comparable materials dumped in 2009 by every single oil platform of Denmark and Norway combined.

These news echo the many warnings made by the opponents of the cluster of five dams at Kárahnjúkar and nearby Eyjabakkar, who repeatedly stated that the project’s alleged profitability was nothing but an illusion, but were systematically silenced by Iceland’s authorities.

Now, as these facts finally become established in the media—this time straight from the horse’s mouth—similarly bad news has arrived regarding another big Icelandic energy company. Reykjavík Energy has failed to make a profit from their 2007 and 2008 investments, effectively making them lose money. At the same time, new research shows that the environmental impacts of the Kárahnjúkar dams are exactly as vast and serious as environmentalists and scientists feared.

And yet, more dams, geothermal power-plants and aluminium smelters are on the drawing table—presented as the only viable way out of the current economic crisis.

Dividend: Close to Zero

During the last half century, Landsvirkjun has paid its owner—the Icelandic nation—only 7,8 billion Icelandic Krónur (66 million USD at present value) as dividend, which according to Hörður Arnarson is way too low and in fact almost equivalent to zero. While it would be fair to expect around eleven percent dividend from the company’s own equity, it has been at an average of two percent since Landsvirkjun was founded. The income from the Kárahnjúkar plant has been about 6 percent of its book value, which again is too low, as according to normal standards the income should be 9 percent of the book value.

At present, Landvirkjun’s total earnings have been 73 million US dollars at most, whereas it should be closer to 180 million USD, considering the owner’s 1,6 billion USD equity. It was made clear by Arnarson that the price of energy purchased by large-scale energy consumers plays a major role herein—a price that obviously has been far below any rational logic and standards.

Same Old, Same Old

In 2003, British newspaper The Guardian published “Power Driven”, Susan De Muth’s exclusive report about the Kárahnjúkar power plant, which at that point was already under construction. Among many critiques made in the article, De Muth questioned Kárahnjúkar’s allegeded profitability. She wrote:

Thorsteinn Siglaugsson, a risk specialist, prepared a recent independent economic report on Karahnjukar for the Icelandic Nature Conservation Association. “Landsvirkjun’s figures do not comprise adequate cost and risk analysis,” he says, “nor realistic contingencies for overruns.” Had the state not guaranteed the loans for the project, Siglaugsson adds, it would never have attracted private finance. “Karahnjukar will never make a profit, and the Icelandic taxpayer may well end up subsidising Alcoa.”

Siglaugsson is just one of many who critically analysed the economics of the Kárahnjúkar project, concluding that its contribution to Iceland’s economy would be about none—or in fact negative. But just as many geologists who cautioned against the risks of locating the dams in a highly geologically seismic area were dismissed by Valgerður Sverrisdóttir, then Minister of Industry, as “politically motivated and not to be listened to”, so were the skeptical economists.

De Muth’s article caused a real stir in Iceland, manifest for instance in the fact that Landsvirkjun and Iceland’s Embassy in London contacted The Guardian in a complaint about “so much space […] used for promoting factual errors and misconceptions of the project and Icelandic society as a whole.” Friðrik Sophusson, Landsvirkjun’s director at that time—who in the article is quoted calling all of Kárahnjúkar’s opponents “romantics”—actually offered The Guardian to send another journalist over to Iceland in order to do “a proper report on issues in Iceland”, this time with his “assistance.” ALCOA also sent a barrage of objections to the Guardian. All the facts presented in the article were double checked by the Guardian’s legal team and confirmed to be accurate.

This volatile response from the authorities and corporates only strengthened the article’s points on the Icelandic tradition of suppressing criticism. This was confirmed in a letter to The Guardian by Icelandic environmentalist and commentator Lára Hanna Einarsdóttir, who suggested that “an Icelandic journalist would have lost [his or her] job if he or she had been so outspoken.”

The Coming Recession

And no wonder, as the article pinpointed serious flaws in the whole rhetoric surrounding the plans to heavily industrialize Iceland, plans that would be nothing without the construction of a series of mega hydro dams and geothermal power plants. Whereas these plans were presented as a path to an increased economical prosperity, De Muth quoted aforementioned economist Siglaugsson, who voiced his fear “that a boom during the construction period, with attendant high interest rates, will be followed by a recession.”

And as time told, this was indeed what happened. In an article published in the early days of Iceland’s current financial crisis, Jaap Krater, ecological economist and spokesperson of Saving Iceland, gave it a thorough explanation:

These mega-projects in a small economy have been compared to a ‘heroin addiction’. Short-term ‘shots’ lead to a long-term collapse. The choice is between a short-term infuse or long-term sustainable economic development. The ‘shot’ of Fjardaal [Alcoa’s aluminium smelter in Iceland, powered by the Kárahnjúkar power plant] overheated the Icelandic economy.

Recognizing the dangers of overheating the economy—a point also made clear in Charles Ferguson’s recent documentary, Inside Job—leaves us with two options. As Krater pointed out:

There has been a lot of critique on the proposed plans to develop Iceland’s unique energy resources. Those in favour of it have generally argued that it is good for the economy. Anyone who gives it a moment of thought can conclude that that is a myth. Supposed economic benefits from new power plants and industrial plants need to be assessed and discussed critically and realistically. Iceland is coming down from a high. Will it have another shot, or go cold turkey?

Another Shot, Please

This spring, Landsvirkjun stated that if the company was to start its operations from scratch the aluminium industry would be its prime costumer. This particular paradox—as the aluminium industry is already its biggest energy purchaser—was just one of Landsvirkjun’s many. Another one is their suggestion that Icelanders should “settle upon” plans to build 14 new power plants in the next 15 years. And the third one is the company’s plans to sell more energy to aluminium companies—costumers who, in Landsvirkjun’s own words, do not pay a fair amount for what they get.

But Arnarson has said that the future looks better, referring for instance to the fact that the price for Kárahnjúkar’s energy is directly connected to world-wide aluminium prices, which Arnarson says are getting higher. Herein is the fourth paradox, as linking energy prices with aluminium prices has so far been disastrous for Iceland’s economy—most recently acknowledged in an official report regarding the profitability of selling energy to heavy industry. According to the report, commissioned by the Ministry of Finance and published last Friday, December 2nd, the total profitability has been an average 5% from 1990 until today, which is far below the profitability of other industries in Iceland, and much lower than the profitability of similar industries in Iceland’s neighbouring countries. The year 1990 is crucial here, as since then, Landsvirkjun’s energy prices to heavy industry have been directly linked to global aluminium prices.

It is worth quoting Jaap Krater again here, where he explains the dangers of interlinking these two prices, and describes how increased aluminium supply will lower the price of aluminium and decrease revenue for Iceland:

One might think that a few hundred thousand tons of aluminium more or less will not impact the global market. The reality is that it is not the sum of production that determines the price but rather the friction between supply and demand. A small amount of difference can have a significant effect in terms of pricing.

High Costs, Low Production

On top of this, recent calculations revealed in newspaper Fréttablaðið, show that Kárahnjúkar is Landsvirkjun’s proportionally most expensive construction. When the production of each of the company’s power plants is compared with the production of Landsvirkjun’s property as a whole, as a proportion of their construction costs, it becomes clear that Kárahnjúkar—with its 2.3 billion USD initial cost—is the most economically unviable plant.

Another Energy Company in Crisis

At the same time that Icelanders face Landsvirkjun’s confession to it’s virtually zero profitability, a damning report on another big energy company, Reykjavík Energy (OR), has been made public. It was originally published at the beginning of this year but wasn’t supposed to enter the public sphere, which it indeed didn’t until in late November. Reykjavík Energy’s biggest shareholder is the city of Reykjavík, meaning the inhabitants of Reykjavík.

As already documented thoroughly, the company—which operates several geothermal power plants, including Hellisheiðarvirkjun, largely built to fuel Century Aluminum’s production—is in pretty deep water. But the newly leaked report proves that it has sunk even deeper than generally considered. The report is a literal condemnation of the company, its board and its highest ranking managers, who get a grade F for their job. A good part of Reykjavík Energy’s investments from 2007 and 2008 are now considered as lost money.

The report also reveals that when energy contracts between OR and Norðurál (Century Aluminum) were made, for the latter’s planned fantasy-of-a-smelter in Helguvík, Reykjavík Energy’s directors completely ignored the very visible economic collapse confronting them.

Recently it has been reported that Reykjavík Energy owes 200 billion Icelandic ISK in foreign currency, which is two thirds of all foreign debts owed by Icelandic companies, whose income is not in foreign currency.

What we see here are two of Iceland’s largest energy companies, both of them public property, both having spent hugely excessive amounts of money—or more precisely, collected gigantic debts—struggling to continue to build power plants in order to feed the highly energy intensive aluminium industry with dirt cheap and allegedly “green” energy. As a result, they have ended up without profit and in a deep pool of debt.

And who is to pay for their gambling risks? As Thorsteinn Siglaugsson stated in 2003: the Icelandic taxpayer.

“No Impacts” Become Huge Impacts

To make bad news even worse, the irreversibly destructive ecological impacts of the Kárahnjúkar dams have, in the last months, become more and more visible. To quote “Power Driven” once again (as simply one of a good number of warnings on the dams’ environmental impacts):

The hydro-project will also divert Jokulsa a Dal at the main dam, hurtling the river through tunnels into the slow-moving Jokulsa i Fljotsdal, which feeds Iceland’s longest lake, Lagarfljot. The calm, silver surface of this tourist attraction will become muddy, turbulent and unnavigable.

This was written in 2003. Today, this is what is happening: because of the river’s glacial turbidity Lagarfljót has changed colour, which according to Guðni Guðbergsson, ichthyologist at the Institute of Freshwater Fisheries (IFF), means that light doesn’t reach as deep into the water as before (see photos aside and below). Photosynthesis, which is the fundamental basis for organic production, decreases due to limited light, its domino effects being the constant reduction of food for the fish. IFF’s researches show that near Egilsstaðir, where visibility in Lagarfljót was 60 cm before the dams were built, it is now only 17 cm. They also show that there are not only less fish in the river, but that the fish are much smaller than before.

In addition to this, residents by Lagarfljót have faced serious land erosion due to the river’s increased water content and strength.

This effect was warned of in an Environmental Impact Assessment (EIA) for the project by the Iceland National Planning Agency (INPA), purposely ignored and overruled by Siv Friðleifsdóttir, then Minister of Environment. Landsvirkjun had complained to the Ministry of the Environment, and the EIA ended up on Friðleifsdóttir’s table, who nevertheless issued a permit for the construction, stating that the dams would have no significant impact on Lagarfljót.

In response of the news on Lagarfljót’s current condition, Svandís Svavarsdóttir, Minister of the Environment, said during parliamentary discussion last September, that her Ministry’s over-all administration regarding the Kárahnjúkar decision-process will be examined in detail. She should demand a similar investigation into the decision making of the Ministry of Industry, whose Minister, Valgerður Sverissdóttir has, along with Landsvirkjun’s Friðrik Sophusson, openly admitted while joking on film with the US ambassador in Iceland, how they enjoyed “bending all the rules, just for Alcoa.”

All the Old Dogs

Despite all of this, Iceland’s energy companies, hand in hand with the aluminium industry, some of the biggest labour unions and industry-related associations—not to mention a majority of parliamentarians, including those of government-member social-democratic Samfylkingin—are still in heavy industry mode, campaigning for the construction of more dams, geothermal power plants and aluminium smelters. Ironically, but still deadly serious, smelter projects such as Century Alumium’s Helguvík, which is at a standstill, unable to guarantee both necessary energy and financing, continue to be presented as profitable solutions to the current crisis.

Met with little resistance in parliament, most of these plans are still considered to be on the drawing table, though most of them seem to be on hold when looked at closely. The latter is mostly thanks to grassroots activists, bloggers and commentators who have systematically reminded the public of the reality, while the bulk of journalists seem to be unable to stick to facts—being extraordinarily co-dependent with those in favour of further heavy-industrialization.

Under the banner of “solving the crisis”, “creating jobs”, and most recently “getting the wheels of work to spin again”, the heavy industry-favoured parties seem to simply refuse to listen to hard facts, even their very own. This attitude is probably best summed up in the recent words of Valgerður Sverrisdóttir, responsible as Minister of Industry, for the building of the dams at Kárahnjúkar, who in response to the news about the power plant’s close-to-zero profitability, said that she wouldn’t want to imagine how the current financial situation would be, if the dams hadn’t been built.

It is said that an old dog will not learn new tricks. And to be honest, ‘old dogs’ pretty accurately describes those making decisions on Iceland’s energy and industry affairs. In order to learn from mistakes and prevent even bigger catastrophes, it wouldn’t be unfair to ask for a new generation—would it?
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More photos of Lagarfljót’s turbid condition

These photos are from 2008, which suggests that the current condition is even worse.

The smallest aluminium smelter in Iceland uses 50% more electricity than all of Iceland’s households and businesses combined, while contributing very little to the country’s GDP. Heavy industry has often been touted by Icelandic conservatives as a cash cow: foreign companies can provide the country with jobs, while utilising Iceland’s green energy to produce aluminium in a cleaner fashion.

While the myth of the “green smelter” has been definitively put to rest, aluminium is still billed by some as being good for the economy. However, Vilhjálmur Þorsteinsson – the chair of a study group assembled by the Ministry of Industry that studies Iceland’s energy use – has come to some damning conclusions about smelters in Iceland.

Iceland’s three aluminium smelters – Alcoa in Reyðarfjörður, Norðurál in Grundartangi, and Rio Tinto Alcan in Straumsvík – consume approximately 13 terawatt hours of electricity. The entire capacity of Iceland’s electrical output is 17 terawatt hours. Furthermore, Straumsvík – the smallest smelter in the country – uses 3.6 terawatt hours. The combined total energy consumption of every home and business in Iceland (apart from the smelters) equals only 2.3 terawatt hours.

At the same time, even the best estimates of what smelters contribute to the economy only put them in the neighbourhood of contributing to 5% of the GDP. Tourism accounts for about the same percentage of the GDP while using far less of the power grid. Meanwhile, Iceland’s service sector accounts for 69.9% of its GDP, and fishing accounts for 12%.

Those who are yet to give up on Icelandic media cannot have avoided noticing one Kristján Már Unnarsson, a news director and journalist at TV station Stöð 2. Kristján, who in 2007 received the Icelandic Press Awards for his coverage of “everyday countryside life”, is a peculiar fan of manful and mighty constructions and loves to tell good news to and about all the “good heavy industry guys” that Iceland has to offer.

To be more precise, Kristján has, for at least a decade (and I say “at least” just because my memory and research doesn’t take me further back), gone on a rampage each and every time he gets the chance to tell his audience about the newest of news in Iceland’s heavy industry and energy affairs. He talks about gold-mills when referring to dams built to power aluminium production; and when preparing an evening news item on, say, plans regarding energy and aluminium production, he usually doesn’t see a reason for talking to more than one person – a person who, almost without exception, is in favour of whatever project is being discussed.

After witnessing Kristján’s latest contribution to the ongoing development of heavy industry and large-scale energy production, i.e. his coverage of Alcoa’s recently announced decision not to continue with its plan of building a new aluminium smelter in Húsavík, wherein he managed to blame just anything but Alcoa itself for the company’s decisions, I couldn’t resist asking (and, really, not for the first time): What can really explain this way too obvious one-sidedness, manifest not only in this one journalist’s work but seemingly the majority of news coverage concerning heavy industry?

“Lack of professionalism,” someone might say. Professionalism would thus imply allowing more than one single voice to be heard, letting one argument meet another, allowing conflicts to take place and thereby giving the audience a chance to critically make up its mind. This lack of professionalism actually applies to such a huge quantity of all news material produced. Indeed, the constant recycling of content – of interviews, press-releases, photos etc. – and the manufacture of single-perspective news content often seems to be the mainstream media’s predominant modus operandi.

“Co-dependency,” could be another suggestion. And a good one, as it often seems that the bulk of journalists are seriously co-dependant with the ruling political and economical order. Take, for instance, the mantra of the never-questioned importance of non-stop economic growth, or the commonly heard phrase that during a protest “the police needed to use teargas” – as the decision to spray isn’t fuelled by a precise political will, but rather of a simple need.

These two are good answers, but definitely not good enough when standing on their own. To get the full picture, lets look into the relationship between mainstream journalism on the one hand, and public relations on the other. How, for instance, are the tops of the aluminium and energy companies’ PR departments staffed?

At Reykjavík Energy we have Eiríkur Hjálmarsson, former journalist and program maker at state TV station RÚV, whereas at Landsvirkjun we find one Ragna Sara Jónsdóttir, former journalist at RÚV and newspaper Morgunblaðið. Alcoa prides itself of Erna Indriðadóttir, long-time journalist at RÚV, while Rio Tinto Alcan sports Ólafur Teitur Guðnason, former journalist at RÚV, DV and business paper Viðskiptablaðið (it is worth noting that Ólafur is also known for his aonce-annual books analysing and criticising the mdia, not from the usual Chomsky-alike left-wing but rather a right-wing perspective). At last but not least, the only employee of Samál (or The Icelandic Association of Aluminium Producers), is Þorsteinn Víglundsson who, along with a few jobs in the financial sector, used to write news for Morgunblaðið.

Quite an impressive list, isn’t? And where does it bring us? Possibly to the assumption that the first-mentioned Kristján Már Unnarsson must be doing his entrance examination, or even an on-the-job-training. But that would be a bit too simplistic because practically, Kristján Már might well be preparing for a better paid PR job, whereas theoretically it really doesn’t mater if that is the case or not.

What matters is the ever impenetrable handshake between those two industries: Public Relations and The Media. What, in fact, is one medium’s coverage of a company but a conversation between the two parties? A pre-designed and post-edited conversation, for sure, but a conversation nevertheless. And the conversation element is crucial as a journalist’s co-dependency and lack of professionalism (deliberate or not) are of no use if the Holy Trinity’s most important link is missing. And vice versa: Without beneficial journalists, a PR stunt is likely to end up dead in the water.

The stunt’s key moment, as Spice Girls realised and told us, is “when two become one.”

As from 2005 Alcoa, along with national energy company Landsvirkjun, Húsavík’s authorities and – to begin with – the Icelandic authorities, has been working on the project, which would have required at least 400 MW of energy, produced by harnessing geothermal areas and glacial rivers in the North. In 2008 a Memorandum of Understanding (MOU) between Landsvirkjun and Alcoa expired, and a year later the same happened concerning a MOU between the aluminium producer and the Icelandic government, the latter not willing to renew it.

Since then Landsvirkjun has signed a few other MOUs, regarding geothermal energy commerce, with possible buyers such as data centres and silicon factories, in some ways meeting with a popular demand for less destructive and more “green” use of the geothermal energy. Regardless of what one finds about the alleged “greenness” of such enterprises this development has inevitably raised the question if Landsvirkjun would be able to feed both Alcoa’s planned smelter and at the same time these smaller, less energy intensive factories.

Environmentalists have warned of the over-exploitation of geothermal energy. In fact, as early as in 2008, when Landsvirkjun’s official plan still seemed to include only Alcoa’s smelter, Saving Iceland insisted that the damming of one or more of the glacial rivers in the North was crucial if Landsvirkjun was to provide energy for a the smelter. At that time Alcoa had already stated that a 250 thousand ton smelter would be “unsustainable” and that the company would want to build at least a 346 thousand ton smelter in Bakki. For a smelter of that size 400 MW would have been needed in addition to the already planned 400.

In 2008 Þórunn Sveinbjarnardóttir, then Minister of Environment, ruled that the project needed to undergo a joint Environmental Impact Assessment (EIA), taking into account not only the impacts of the smelter per se but the whole infrastructure around it, including the power plants and energy transportation. The company’s response, as well of others in favor of the smelter, was that the minister’s ruling was a political attack against the project, only meant to delay the process.

The first draft of the joint EIA report was ready in the spring 2010 and a few months later Iceland’s National Planning Agency published its comments on it. The Planning Agency’s comments were damming, stating that the projects impacts would be high and could not be mitigated; its greenhouse gas emissions would constitute 14% of Iceland’s total and 17,000 ha of pristine wilderness would be affected. Most importantly, as pointed out by Jaap Krater, ecologial economist and spokesperson of Saving Iceland, the Agency highlighted the “uncertainty on the full impact of the planned power plants and particularly on how much geothermal energy can be sustainably produced. Finally, the assessed energy projects will not be able to fully power the smelter, with 140 MW of capacity missing.”

This energy crisis – similar to the one Century Aluminum is facing, regarding geothermal energy for their planned smelter in Helguví, South of Iceland – is no doubt the main factor leading to Alcoa’s withdrawal, though the company and other interested parties blame the joint EIA and the current government’s energy policy. As mentioned before this has been clear for a long time – in January this year business newspaper Viðskiptablaðið reported that Alcoa was about to withdraw from the Bakki project due to energy uncertainties. The final straw, according to the paper’s sources, was Landsvirkjun’s discussions with a company called Carbon Recycling, which plans to build a methanol plant run on geothermal energy from the North. This was, however, rejected by the company only a week later. Alcoa said that the smelter was still on their drawing table and that a permit for at least 500 MW of geothermal energy existed.

Though Alcoa’s representatives, as well as Húsavík’s authorities and other parties favouring heavy industry, have since yesterday acted as Alcoa’s withdrawal is somewhat of a shocking news, Katrín Júlíusdóttir, Minister of Industry, says that it is of no surprise to her. Alcoa has, according to Katrín, had a head start on all other possible energy purchaser, which it has not used in its own favour.

In a two pages interview with newspaper Morgunblaðið today – free from even a single comment from an environmentalist or other critical perspective – Tómas Már Sigurðsson, Alcoa’s director in Iceland, does not admit that the actual energy uncertainty, addressed by environmentalists and the National Planning Agency, has been the company’s main hindrance. Tómas, however, hints at it when stating that Alcoa has from the start been clear about its thirst for more then 400 MW, given that more than that can be harnessed in the North.

Tómas also says that the price that Landsvirkjun wants for the energy is not “competitive” – or in other words: too high. For the last year Landsvirkjun has been heavily criticized for prizing its energy seriously low, mapping Iceland out as a cheap energy haven for the aluminium industry, which makes it especially interesting that now Alcoa – an international corporation and of the world’s biggest aluminium producers – claims it cannot pay for Icelandic energy.

Now, as Alcoa’s dream of a smelter in Bakki is over – after six years process, including an investment of two billion ISK (17,3 million USD) – Tómas says that the company will continue its plans of further projects in Quebec, the New York state, Norway and Saudi Arabia. Also, as repeatedly reported by Saving Iceland, Alcoa recognizes Greenland as its next Iceland, from a social and economic perspective – i.e. easy exploitable society and cheap energy – and plans to build at least a 400 thousand ton smelter there in the nearest future.

Albeit the clear fact that Alcoa’s withdrawal from Bakki does not manifest the company’s worldwide decrease in operations, it surely marks a milestone in the struggle against the aluminium industry – not only in Iceland, but also worldwide. More on that later.
_____________________________________

See also:

Alcoa in Greenland: Empty Promises? by Miriam Rose
Alcoa: Where Will the New Dams be Built? by Jaap Krater
Greenland’s Decision: Nature or Culture? by Miriam Rose

The Energy Master Plan is a framework programme, meant to result in a long term agreement upon the exploitation and protection of Iceland’s glacial rivers and geothermal areas. Its making, which since 1999 has been in the hands of special steering committiees, established by the two above-mentioned ministries, reached a critical status in July this year when its second phase was finished and presented to the ministers who in mid August presented their proposition for a parliamentary resolution. Before it will be discussed in parliament the proposition will be open to comments and criticism from the public, as well as interested parties, energy and aluminium companies on the one hand, environmentalists on the other.

Twenty-Seven Energy Options Put on Hold

The proposition lists natural areas into three categories; protection, exploitation and hold. The last-mentioned includes areas that, according to the steering groups and ministers, have not undergone enough research for a decision to be made upon weather to protect or exploit them. Included in this category are, among other, the glacial rivers in fjord Skagafjörður as well as other rivers such as Skjálfandafljót, Hvítá, Hólmsá and Farið by lake Hagavatn in the south-west highlands. Also geothermal areas such as Trölladyngja and Austurengjar in Krýsuvík and certain areas around mount Hengill where the heavily indebted Reykjavík Energy (OR) already operates Hellisheiðarvirkjun, a sulphur polluting geothermal power plant. The 27 areas of the waiting category will be revised in five years, given that satisfactory studies have been made at that time.

Þjórsárver Wetlands to be Saved

Delightfully, the protection category features the uppermost part of river Þjórsá where Landsvirkjun wants to construct Norðlingaölduveita, a dam that would destroy the Ramsar listed Þjórsárver wetlands. River Jökulsá á Fjöllum, which has been seen as an energy potential for a new Alcoa aluminium smelter in Bakki, is also listed protected. The same applies for certain parts of river Tungná, in which Landsvirkjun is already building the Búðarháls dam that will provide energy for increased production in Rio Tinto Alcan’s aluminium smelter in Straumsvík.

The protection category also features geothermal areas such as the ones around Brennisteinsfjöll mountains on the Reykjanes peninsula, as well as Gjástykki, close to volcano Krafla and lake Mývatn. The same goes for the Grændalur valley and Bitra, which are located close to the small town of Hveragerði and have been particularily desirable in the eyes of energy companies. Bitra was saved by a local campaign in 2008 whereas Grændalur was recently threatened when Iceland’s National Energy Authority allowed a company called RARIK to operate test drilling in the valley, in complete contravention of previous rulings by the Ministries of Industry and of Environment.

Krýsuvík, Þeistareykir and Þjórsá to be Destroyed

The exploitation list features geothermal areas Þeystareykir, Bjarnarflag and Krafla in the north of Iceland, as well as Hágöngur in the mid-highlands west to glacier Vatnajökull. Also certain parts of the area around mount Hengill and finally geothermal spots in Reykjanes, Krýsuvík and Svartsengi, all three on the Reykjanes peninsula. Rivers Hvalá, Blanda and Köldukvísl are then all categorised as exploitable. And most critically the Energy Master Plan proposition allows for Landsvirkjun’s construction of three dams in the lower part of river Þjórsá.

Environmentalists Threefold Response

The most common response from environmentalist so far has been threefold. Firstly there generally satisfied by the protection of areas such as the Gjástykki, Jökulsá á Fjöllum and Grændalur, let alone the Þjórsárver wetlands. Shortly after the publication’s release, Iceland Nature Conservation Association (INCA) stated that, if approved by parliament, the Master Plan will mark the end of environmentalists’ forty years long struggle to save Þjórsárver from destruction. Though listed by the international Ramsar Convention on Wetlands due to its unique ecosystem, the wetlands have been on Landsvirkjun’s drawing table as a potential for construct a large reservoir, meant to produce energy for a planned expansion of Rio Tinto Alcan’s aluminium smelter in Hafnarfjörður, which was later thrown off in a local referendum. The plan has always been met with fierce opposition, no matter of Landsvirkjun’s repeated attempts to get it through by proposing a smaller dam and reservoir.

Secondly environmentalists are critical of the fact how many invaluable areas, such river Skjálfandafljót, are kept on hold instead of simply been categorised protected. Thirdly there is a clear opposition to the planned exploitation of certain wonders of nature, one example being the geothermal areas on the Reykjanes peninsula. Ellert Grétarsson, a photographer who has documented these areas extensively (his photos are here aside), fears that the drilling in Krýsuvík – covering between five and eight thousand square meters of land – will simply kill the area. And as a matter, says Ellert, the whole Reykjanes peninsula will be riddled with energy construction. Hjörleifur Guttormsson, former Left Green MP and a genuine environmentalists, shares Ellert’s worries and has asked for an integral study of Reykjanes before any decisions are made.

Þjórsá, the Bone of Contention

As as mentioned before the biggest concern regards Þjórsá, which has for a long time been the bone of contention between the two clashing arrays fighting for or against nature conservation. The struggle over Þjórsá has been especially tough, actually to such an extent that the government can be reputed to stand or fall with that conflict in particular. Guðfríður Lilja Grétarsdóttir, MP for the Left Greens, demonstrated, during parliamentary debate last April, her full opposition to the construction of dams in Þjórsá. At that point, three Left Green MPs, who up until then had been increasingly critical of the government and its lack of left-leaning policies, had just recently departed from the party, leaving the government with only one person’s majority in parliament. And as most members of the social-democratic People’s Alliance (Samfylkingin), which makes up the government along with the Left Greens, have not shown a sign of objection to the damming of Þjórsá, it wouldn’t be surprising if the river will be up for a heavy debate in parliament.

In fact it is more than sure that Þjórsá will be among the main matters of argument in parliament. The right wing Independence Party, which was in in power from and is largely responsible for the neo-liberalisation and heavy-industrialisation of Iceland, has always been one of the driving motors behind Landsvirkjun’s plans to dam Þjórsá. When the Master Plan’s proposition was presented in August, Ragnheiður Elín Árnadóttir, a MP of the party, called for the immediate starting of construction in Þjórsá. She also said she grieved the long period of which the project has been stuck within bureaucracy, referring to the attempts of Svandís Svavarsdóttir, current Minister of Environment, to halt the construction of one of the three proposed dams by refusing to include the dam, Urriðafossvirkjun, in a land-use plans for the parishes of Flóahreppur and Skeiða- and Gnúpverjahreppur (rural districts along Þjórsá) made by them at the request of Landsvirkjun.

Three Dams: Threat to Society and Ecology

The conflict in parliament mirrors the actual conflict in the Þjórsá region where locals have for a long time fought over the river’s fate. There Landsvirkjun hasn’t only used bribes in its attempt to get its plans through local administration, but also threatened farmers whose lands are at stake will the dams be built, by stating that if the farmers do not negotiate with the Landsvirkjun, the company will attempt for a land expropriation. This conduct has created a complete split within the local community, clearly demonstrated in last March when young locals from the region published a statement, in which they demanded a permanent halt to all plans of damming Þjórsá – thereby an end to the social conflict associated.

As a matter of fact two members of the Master Plan’s steering committee recently stated, when interviewed on state radio station RÚV, that due to the serious lack of studies regarding the social impacts of the planned Þjórsá dams, those plans should without any doubt have been put on hold. This is exactly what Guðmundur Hörður Guðmundsson, chairman of environmentalist organization Landvernd, said in last July following the publication of the Energy Master Plan’s second phase report.

Þjórsá’s position in the Master Plan proposition, yet shouldn’t be of any surprise. In the second phase report the three planned dams are not considered to be a great threat to the ecology of Þjórsá and its surroundings – contrary to the opinion of environmentalists who have voiced their worries concerning the dams’ impacts, for instance on the river’s salmon stock. Orri Vigfússon, chairman of the North Atlantic Salmon Fund (NASF), recently stated that “never before in the history of Iceland has there occurred such an attack on a sensitive area of wild salmon.” As is considered that the salmon’s spawning and breeding grounds are mosty located above waterfall Urriðafoss, where one of the three dams is planned to be built, Orri believes that the stock of salmon and salmon trout are likely to vanish.

Energy Companies Unsatisfied as Expected

As one could have imagined, Icelandic energy companies and other adherents of large-scale power production for heavy industry, are everything else than happy about the Master Plan’s proposition. Following its release Eiríkur Hjálmarsson, Public Relation manager of Reykjavík Energy, opposed the protection of Bitra on the ground that the company has already harmed the area with three examination boreholes, roads and electricity lines – but most importantly, spent 785 million ISK on the project. As reported earlier this year by Anna Andersen, journalist at the Reykjavík Grapevine, the foolhardy business operations of Reykavík Energy during the last decade or so – including large-scale geothermal projects associated with heavy industry – have brought the publicly owned company a debt of 233 billion ISK (2 billion USD or 1.4 billion Euros). Despite this financial collapse the company still advocates for the continuation of the agenda that brought it down.

Other energy companies have responded similarly, mostly complaining about the amount of areas listed as protected or on hold. Landsvikjun’s director Hörður Árnason has said that compared to the second phase report, the parliament proposition suggest that way too many energy options are put on hold. Another company, Suðurorka, owned by Alterra Power (former Magma Energy) and Íslensk Orkuvirkjun, had planned to construct a dam, called Búlandsvirkjun, in river Skaftá – a plan that the proposition puts on hold. The company argues that few energy options have been studied as thoroughly and while the studies might have been done – and might be thorough – not everybody agrees with the company on the impacts. Farmers in the area have opposed the project as some of their most important grasslands will be drowned under the dam’s reservoir.

Energy company RARIK will, due to the Master Plan, loose its grip on geothermal areas in Grændalur valley, as well as rivers in Skagafjörður and Hólmsá river – projects that the company claims to have invested in with 300 million ISK. Using the same monetary argument, HS Orka, also owned by Alterra Power, has been vocal about its 700 million ISK investment into their proposed, but now delayed if not entirely halted, geothermal plants in Trölladyngja. Finally representatives from Reykjahlíð, a small town that holds the good part of Gjástykki’s property rights, have stated that if the area will be protected, billions of ISK will be demanded as compensation.

The Predominant Strategy

Those arguments do in fact manifest the predominant strategy of those involved in the heavy industrialization of Iceland. Instead of waiting for all necessary contracts to been signed, all needed permissions to be granted, and all required energy to be ensured, the energy and aluminium companies have simply started major construction immediately when only one or a few permissions have been granted. And when criticised, not to mention when forced to stop, they have stated that because these projects have been announced and vast amounts of money put into them, they should be allowed to continue. If needed, they have also pointed out that because the natural areas at stake have already been harmed (by themselves), there is “no point” in preserving them.

One example would be Helguvík, where a framework for a proposed Century Aluminum smelter has already been built but hardly any construction has taken place there for two year. With every day that passes it becomes clear that not only has the company failed to ensure the energy needed to operate the smelter, but also that the energy simply doesn’t exist.

Geologist Sigmundur Einarsson has, for the last years, pointed this out and stated that the amount of energy needed for the Helguvík smelter cannot be found and harnessed on Reykjanes, like stated by the parties involved. For instance he believes that no more than 120 MWe can be harnessed in Krýsuvík, contrary to the official numbers of 480 MWe, and has repeatedly demanded answers from the authorities about where from the rest of the energy is supposed to come. Just as Saving Iceland’s questions about the whereabouts of energy for Alcoa’s planned smelter in Bakki, Sigmundur’s questions have never been answered, but he claims the Energy Master Plan proofs his theory.

Yet Another Three Kárahnjúkar Dams!

Environmentalists have reacted to the energy companies’ complaints and asked how on earth the companies can still pretended to be unsatisfied. As pointed out by Landvernd, these company’s are about be granted permission to harness energy equivalent of three Kárahnjúkar dams. From 2004 to 2009, Iceland’s energy production duplicated, largely with the construction of Kárahnjúkar dam, and is currently 16,900 gigawatt-hours. If the Energy Master Plan will be accepted as proposed, the energy companies will be able to duplicate the production again in few years, says Guðmundur Hörður, chairman of Landvernd, and continues:

The increase of public electricity usage is about 50 gigawatt-hours per year. The expansion entailed in the proposition would thus sustain that particular public increase for the next 265 years! If this will be the conclusion, the energy companies can be very satisfied. Still they send their agents onto the media, in order to cry and complain. That doesn’t give a good hint for a settlement.

Other environmentalists, Ómar Ragnarsson for instance, have mentioned that the whole discourse surrounding the Energy Master Plan portrays a false image. While the plan regards Iceland’s each and every hydro and geothermal area, potential for exploitation, the areas that have already been harnessed are kept outside of the discourse. Ómar says that it is simply false to state that “only twenty-two areas” have been categorised exploitable, as twenty-eight large power plants have already been built in Iceland. That means that out of the ninety-seven considered in the Master Plan, fifty have already been or will be utilised. In addition to the twenty-seven areas put on hold, another thirty-two have yet not been categorised by the steering committees, which makes the current proportion of protected areas even lower.

Ómar has also pointed out mismatches within the proposition. One example regards geothermal area Gjástykki that is listed as protected, as it is “a part of Krafla’s volcanic system, which has a protection value on a worldwide scale,” like stated in the proposition. But according to Ómar this will depend entirely on definitions. As an energy option, Vítismór, which is a part of Krafla’s volcanic system and is an inseparable part of the Gjástykki-Leirhnjúkur area, is currently listed as an addition to the Krafla power plant and would thus, regardless of its position within the Master Plan, be available for exploitation.

Limnology (or freshwater science) professor Gísli Már Gíslason upholds Ómar’s argument and has stated that half of Iceland’s “profitable hydro power” has already been utilised. One of those rivers is Jökulsá á Dal, harmed by the infamous Kárahnjúkar dam, which in order to be built required disallowing the protection of Kringilsárrani, an extremely important grassland for reindeer. This is not a unique incident as, for instance, the three dams in river Láxá are also manifestations of hydro power plants built in protected areas.

The Coming Struggle

Notably by the above-listed contradictions, which though demonstrate only a small part of the debate about the Energy Master Plan so far, the coming struggle about the fate of Iceland’s nature is going to be harsh and heavy. Armed with the rhetoric of economic crisis, unemployment etc., those in favour of heavy industry – in other words a big part of parliament, the energy companies, the Associations of Industry and Employers, the country’s biggest trade unions, and most recently Samál, a joint association of aluminium producers in Iceland – use literally every opportunity to push for the further development of industry, especially aluminium. In order for that development to occur, the country’s glacial rivers and geothermal areas have to be exploited on a mass scale.

Environmentalists, on the other hand, need to sharpen their knives and both ask and answer a great amount of questions. What, if any, are the actual benefits of heavy industry and its parallel large-scale energy production? And what are its impacts on Iceland’s society and ecosystems? No less importantly, what are its global impacts such as on the atmosphere or bauxite communities in India, Guinea, Hungary and Jamaica? How has it affected the economy and what are its contributions to the current economic situation? What are the impacts of the building of big dams and geothermal power-plants, fuelled by extremely high loans, bringing a temporary pump into the economy that inevitably leads to the demand for another shot? And what is the value of nature per se?

Only by answering all of these and many more questions, one can honestly try to answer the one fundamental question regarding the Energy Master Plan: What actual need is there for yet another three Kárahnjúkar dams, or in fact just a single more power plant?

The companies behind the co-operating forum include energy companies Landsvirkjun, Reykjavík Energy, HS Orka and its owning company Alterra Power Corporation (former Magma Energy), as well as aluminium companies ALCOA and Norðurál, owned by Century Aluminum. Banks Íslandsbanki, Landsbanki and Arion banki are also all involved, the last-mentioned being the forum’s main sponsor. Amongst other parties involved are the Universities of Reykjavík and the University of Iceland, the Federation of Icelandic Industries (SI) and the Confederation of Icelandic Employees (SA), the ministries of environment, of industry, of trade and of foreign affairs, and Mannvit, Iceland’s biggest engineering firm, responsible for both the design and the making of Environmental Impact Assessments for most of the country’s biggest heavy-industry and large-scale energy projects.

To recap, the newly formed co-operating forum manifests that all major parties with direct links and financial interests in the further heavy-industrialization of Iceland and its parallel destruction of the country’s wilderness, have joined forces. And the aim: To increase the competitiveness of Iceland’s geothermal energy industry and its making of capital goods, facilitate the capitalization of geothermal projects, contribute to technological advances and reinforce Iceland’s image.

A Follow-Up of the Plan to Heavy-Industrialize Iceland

During the forum’s establishing meeting, which took place in the headquarters of Arion bank, a new report, titled “The Icelandic Geothermal Cluster – Mapping and Mobilization”, was published, covering “the analysis and the collaboration-formation of the the Icelandic geothermal cluster.” The term business cluster was originally introduced and popularised by the aforementioned Michael Porter, and is, to quote Porter’s own words, a geographic concentration of interconnected businesses, suppliers, and associated institutions in a particular field. According to the idea, the formation of a cluster creates a certain entity, which is supposed to be much stronger than many individual parties each operating separately.

The report – starting with the words of Henry Ford: “Coming together is a beginning, staying together is progress, working together is success” – lays out what it calls “three big growth opportunities”, as the results of the analysis of Iceland’s geothermal cluster. To nobody’s surprise these so-called opportunities consist of bringing energy-intensive industries to Iceland, exporting geothermal energy to Europe through a marine cable, and exporting Iceland’s geothermal expertise. These suggestions are of course no novelty in Iceland but rather a predictable follow-up of the plan to heavy-industrialize Iceland and fully exploit the country’s natural resources – a plan that was well documented in an infamous booklet, titled “Lowest Energy Prices!!”, which was made in 1995 by Landsvirkjun and the ministry of industry, and sent to international energy-intensive heavy industries, offering them cheap energy and “minimum environmental red tape”.

Carefully Chosen Rhetoric and a Private Speech on State Television

Michael Porter has carefully adapted his rhetoric to the current political atmosphere, obviously aware of many Icelanders’ increased doubt and decreased trust towards corporations due to the 2008 economic collapse and many of its following exposures of corruption, as well as the enhanced discussion about the importance of keeping the ownership of natural resources away from private parties. In his forewords to the aforementioned report, he and his co-author, Dr. Christian Ketels, also from Harvard Business School, state that though the “economy has [since the collapse] stabilized at a lower level, and the government has gotten its budget balance so much under control that it is expected to return to the global financial markets later this year […] stabilization is necessary and not sufficient.” And they continue:

Iceland needs to lay the foundations for a new, more sustainable economic growth path. In February 2009, we published an article in the Icelandic press that set out an action agenda for the country. One of its key elements was cluster mobilization as a critical step to build on Iceland’s unique assets and capabilities. We stressed that Iceland had to move beyond a backward looking debate about who was to blame for the crisis to a forward-looking collaboration to improve competitiveness. Clusters are a powerful vehicle to mobilize the private sector and guide the policy choices of government.

The Icelandic geothermal cluster program puts this vision into practice. It builds on Iceland’s unique assets and capabilities in geothermal energy with a clear focus on creating greater value for the Icelandic economy, rather than simply selling power. The geothermal program is grounded in the realization that progress towards this goal will only materialize through collaboration.

Interviewed in Kastljós, a daily news-report show on state-owned TV station RÚV, last night, Porter spoke in a similar way, reminiscent of a memorable Kastljós interview with Ross Beaty, the CEO of Magma Energy (now Alterra Power Corporation), in August 2009. When asked if he understood the public opposition towards privatization after the economic collapse, Beaty said, as reported by Saving Iceland, that he was aware of this but added that Icelanders would have to understand what kind of company he was leading. “We are not a scary company, we want to work with H.S. Orka in building up a stronger company, for the good of Icelanders, ourselves, and actually the whole world,” said Beaty to newspaper Fréttablaðið that same day.

During the TV interview last night, Michael Porter said that he finds Icelanders are “too cautious” when it comes to “using the opportunities that consist in geothermal energy,” and added that there is need for more innovating spirit, aggressiveness and risk-taking. Asked the same the question as Ross Beaty was, a little less than two years ago, Porter answered that the country’s natural resources could still be “owned by the nation” while the utilization rights could be lent to private companies. He also said that though he preferred a mixture of privately and state run businesses, the state-owned energy companies would still have to be run like private companies. This idealisation of privatizing energy companies perfectly resonates a recent encouragement from the Organisation for Economic Co-operation and Development (OECD), set fourth in the institution’s 2011 Economic Survey of Iceland. The interview would better be described as a speech-like monologue as the questioner mostly nodded and occasionally said things like “yes”, “absolutely” and “indeed”. After Porter had described his utopian corporate vision for large-scale geothermal energy production in Iceland, he ended the interview by saying: “Let’s do it!” – followed with an end-note from the presenter: “Let’s hope!”

Fearing Overexploitation of Geothermal Resources

Contrary to the statements about the need for large-scale exploitation of geothermal energy, as mentioned by Porter and the parties of the co-operating forum, environmentalists and Iceland’s National Energy Authority (INEA) fear overexploitation of the geothermal areas that are planned to be exploited to produce energy for aluminium smelter, which in fact constitute all major geothermal areas in Iceland. Recently INEA decided that HS Orka/Alterra Power would have to widen its planned drilling area for the planned enlargement of Reykjanes geothermal power plant and that they would have to supply proof that enough energy can be found on a larger area than already arranged for. The enlargement is meant to provide energy for a planned aluminium smelter in Helguvík, owned by Norðurál/Century Aluminum.

“It is possible to get all this energy on the current construction area, there is no doubt about that,” said energy director Guðni Jóhannesson to newspaper Morgunblaðið in March 2011. But he continued: “But we know it from geothermal areas abroad that if too much construction has taken place in too short time, the capacity of the area can decrease, resulting in the need for reducing the production again.”

Hence, we have it from the horse’s mouth that geothermal energy on a large-scale industrial level is not sustainable.