Photo by Dean C.K. Cox/WPN

Iceland is a world leader in renewable energy, providing virtually all of its electricity and heating from hydroelectric and geothermal sources. The country’s renewable reserves were recently estimated at 50 000 gigawatt-hours per year—more than five times as much as the nation’s total electricity use of 8500 GWh in 2006. But as an island country, Iceland would face difficult challenges in exporting energy. So instead, the country’s government is importing manufacturers that need energy.

That’s the idea behind the Kárahnjúkar hydropower project, set to come on stream in sparsely ­populated eastern Iceland this month. To power the complex, engineers built three large dams to channel the water from two glacial rivers through a 72-kilometer network of steel-reinforced tunnels to the hydroelectric plant shown here. All the power from the project then flows 29 km more to a brand-new aluminum smelter owned by Pittsburgh-based Alcoa. Although the power plant is greenhouse gas–free, surveys have found that many Icelanders are bothered by the environmental impact of the new 57‑square-kilometer reservoir and worry that the Kárahnjúkar project is just the beginning of further exploitation of their environment and energy resources.