Bakki Industrial Park is powered by one of the most robust renewable energy ecosystems in Iceland. The area benefits from exceptional access to geothermal and hydropower resources, creating a stable, low‑carbon, and scalable energy foundation for current and future industries.

Bakki receives its primary power supply from the Þeistareykir Geothermal Power Station, supported by nearby geothermal plants at Krafla and Bjarnarflag, all operated by Landsvirkjun, Iceland’s national power company. This cluster of geothermal stations ensures a steady baseload of clean, renewable electricity year‑round. 

In addition, Bakki is linked directly to Iceland’s high‑voltage transmission system through a Landsnet substation, enabling reliable energy delivery for large‑scale industrial operations. 

Current Capacity and Expected Growth

Today, the energy resources serving Bakki amount to ~100 MW of renewable generation capacity. This existing capacity is already sufficient to support demanding industrial operations such as silicon metal production, data centers, and advanced material processing.

Landsvirkjun is undertaking substantial investment to boost geothermal capacity in North Iceland. The region is expected to see a 70–110 MW increase in available power over the next five years, raising the total to approximately ~200 MW. The more long term plan in other energy production options in the region, including wind, could add another 100 MW putting the total to approximately ~300 MW in 2035. These expansions strengthens Bakki’s long‑term competitiveness and ensures room for new, energy‑intensive industries to grow. 

This planned expansion aligns with Iceland’s national strategy to scale up renewable energy utilization and support a greener, more circular industrial economy. 

Landsnet, Iceland's national transmission system operator, currently has a sub station in Bakki, capable with modification to deliver ~100 MW. 

Landsnet plans to strengthen the energy infrastructure at Bakki by adding a new transmission line and substation in 2029. This upgrade is expected to increase the area’s power‑transport capacity by an additional 150–250 MW, significantly enhancing Bakki’s ability to support new and expanding industries.

Bakki Industrial Park is uniquely positioned near some of Iceland’s most powerful high‑temperature geothermal systems, giving companies exceptional access to both geothermal heat and large volumes of fresh cold water for industrial use. This combination offers a rare and valuable resource base for energy‑intensive and water‑reliant industries.

High‑Temperature Geothermal Systems

The Bakki area benefits from close proximity to major geothermal fields capable of delivering high‑enthalpy water and steam, ideal not only for electricity generation but also for a wide range of direct‑use industrial applications. Industries that require heat—such as drying, processing, thermal conditioning, or chemical/biological operations—can significantly reduce operational costs through the use of geothermal heat.

Two Geothermal Sources Serving Bakki

Hveravellir – 120°C Geothermal Water

The Hveravellir geothermal area provides water at approximately 120°C, with an existing pipeline already connected to Húsavík. This supply is well‑suited for district heating, industrial heat applications, and processes that rely on stable, medium‑to‑high‑temperature water.

Þeistareykir – 280°C High‑Enthalpy Steam and Water

Þeistareykir delivers extremely high‑temperature geothermal resources, reaching up to 280°C. A dedicated pipeline to Bakki is currently in the design phase, opening significant new opportunities for industries that require very high‑temperature steam and advanced thermal processes. The pipeline is expected to be operation in 2031, depending on demand and other factors.

In addition to geothermal heat, Bakki has access to large quantities of clean, fresh cold water, an essential resource for industries such as food processing, aquaculture, cooling‑intensive technologies, and data centers. This reliable cold‑water supply adds a critical layer of flexibility for companies whose operations depend on both thermal and non‑thermal water use.

Húsavík’s deep‑sea harbor plays a central logistical role for industries operating in North Iceland, offering a reliable maritime gateway for heavy transport and international shipping. The harbor is 220 meters in length and 10 meters deep.

Its strategic location, combined with modern infrastructure, makes it a natural hub for expanding industrial activity at Bakki.

Húsavík harbor has long been an important industrial asset for the region. It provides deep‑water access suitable for large vessels and offers efficient connections to industries operating inland. As part of the development of the Bakki Industrial Park, the harbor was integrated into the area’s logistics network through purpose‑built industrial routes, ensuring smooth movement of raw materials and finished goods.

A major milestone in this infrastructure network is the Húsavíkurhöfði Tunnel, commonly known as the Bakki Tunnel. This 943‑meter, two‑lane tunnel directly connects Húsavík’s harbor to the Bakki Industrial Park. Constructed between 2015 and 2017, it is built exclusively for industrial traffic, ensuring safe, fast, and uninterrupted movement of heavy vehicles between the port and Bakki. 

The tunnel dramatically enhances Bakki's logistical competitiveness by providing:

Direct, weather‑protected access between the harbor and the industrial area

Faster and safer transport for heavy freight

Reduced strain on local roads, improving safety and efficiency in the community

Long‑term infrastructure that supports multiple industries, not just a single operator

In Bakki there are 200 ha zoned as an industrial areas - with certain plots already zoned, helping companies to mave fast when needed.