upright|right|thumb|120 px|Geothermal borehole outside the [[Reykjanes Power Station]]Geothermal power in Iceland refers to the use of geothermal energy in Iceland for electricity generation.
Iceland's uniquely active geology has led to natural conditions especially suitable for harnessing geothermal energy. Icelanders have long used geothermal energy for direct applications, such as heating homes and baths. The more recent, widespread adoption of geothermal energy as an energy source in Iceland was spawned by a need to stabilize energy prices and increase energy independence, allowing Iceland to increase reliance on geothermal energy for direct applications alongside electricity generation and contributing significantly to diminishing Iceland's carbon footprint.
The growth of geothermal power in Iceland is due to its continued support from the Icelandic government. As of 2020, Iceland's installed geothermal power production capacity is 799 megawatts (MW). Geothermal energy produces over a quarter of Iceland's total electricity. The country straddles the Mid-Atlantic Ridge (a rift between continental plates), and lies over a volcanic hotspot. This combination of factors has led to pronounced volcanism and geothermal activity. Iceland's power was largely derived from fossil fuels until the 1970s, when the national government looked to address energy price inequities across the country. The first phase was conducted during 1999–2003, which primarily focused on data gathering.
The government still faces issues with providing all households with accessibility to geothermal power, as there remain villages and rural areas that lack geothermal heating infrastructure. Iceland has also helped train geothermal engineers from around the world through the United Nations University Geothermal Training Programme. This means of the total of primary energy used by Iceland in 2020 is from a geothermal source.
Direct applications
Most geothermal energy in Iceland is used for heating activities. As these uses are reliant solely on geothermal heat, they do not result in the energy losses that come with generating electricity. Instead, many of these direct applications use water as the means of transmission. In Iceland's capital Reykjavík, hot water from 100° to 300°C is used to heat homes, then piped into plastic tubing underneath streets and sidewalks at to melt snow and ice.thumb|Iceland electricity production by source
Electricity generation
Iceland has recently been self-sufficient in producing electricity, consistently meeting or exceeding electricity demand in the country mainly through geothermal and hydropower generation.
However, after the droughts in the summer season of 2021, low reservoir levels for hydropower generation along with increasing electricity demand in the nation led to an electricity supply crunch. To suppress electricity demand, the Icelandic government had to cut back electricity from certain industries.
The following are nine power plants that contribute the most to Iceland's geothermal power production capacity; the ownership of each geothermal power plant is also noted:
{| class="wikitable"
|+Icelandic geothermal power plants as of 2020
!Name
!Capacity (MW<sub>e</sub>)
|-
|Húsavík
|2
|Wasabi Energy
|-
|Flúðir
|0.6
|Varmaorka
|}
In Reykjavík, hydrogen sulfide (H<sub>2</sub>S) emitted from two nearby geothermal power plants, Hellisheiði and Nesjavellir, may have impacted residents' health. Research conducted by the University of Iceland in 2012 found that weather events favorable for H<sub>2</sub>S concentrations in Reykjavík greater than the national 24-hour health limit of 50 μg m<sup>−3</sup> can be expected to occur twice a year on average. If successful, the technology being developed by IDDP could produce ten times more power than current geothermal power technology. By drilling more than 15,000 feet (4.5 km) deep into the volcanic fields in Iceland's Reykjanes Peninsula, researchers are hoping to investigate the use of supercritical fluids for harnessing geothermal energy.