The Next Generation of Land-Based Aquaculture in Iceland — A Strategic Opportunity

Iceland has the natural conditions to become a global leader in land-based aquaculture. With renewable electricity, abundant geothermal heat, pristine freshwater and seawater, and efficient transport links to major markets, Iceland enjoys a structural competitive advantage. Properly developed, land-based salmon farming can become a significant value-adding industry—generating foreign revenue, strengthening regional communities, and creating high-quality jobs across multiple sectors.

Predictability and Capacity for Growth

However, natural advantages alone are not enough. The industry cannot scale unless the regulatory framework, infrastructure, and institutional environment are designed to support its growth.

Land-based aquaculture is energy-intensive. Although Iceland’s electricity production is renewable, grid capacity and transmission infrastructure must be expanded to accommodate new industrial sites. Similarly, geothermal heat, which offers a significant advantage for temperature control, can be used only where adequate distribution systems are available. Without coordinated planning for electricity transmission and geothermal infrastructure, growth will remain constrained.

Transport infrastructure and port capacity must also develop in parallel to accommodate the substantial export volumes the sector can generate.

Equally critical is an efficient, science-based permitting process. Investors require regulatory predictability. Capital-intensive facilities demand long-term clarity on environmental standards, emission thresholds, and operational conditions. When legislation, infrastructure planning, energy policy, and environmental standards are aligned, project risk decreases, and access to capital improves.

Leveraging Technology in Harmony with the Environment

The necessary technology is already in place. In Iceland, land-based aquaculture projects rely on systems, which filter, oxygenate, and reuse water in a controlled indoor environment. These systems reduce freshwater use, minimise exposure to disease, ensure biological stability, and enable traceable year-round production.

The value of science-based environmental protection is undisputed. Sludge management protocols and nutrient discharge limits should be grounded in robust scientific data and comprehensive environmental and risk assessments—protecting ecosystems while ensuring fairness and predictability for operators.

A strong circular‑economy approach is key to long‑term sustainability. Sludge from clean, closed‑loop systems—free of harmful contaminants—consists mainly of organic matter and nutrients. Properly treated, it can be used to produce fertilisers, biogas, and soil enhancers. Integrating with greenhouse cultivation and other bio-industrial activities can create interconnected resource systems that maximise efficiency.

The questions we face revolve around whether processed, purified nutrients from aquaculture could contribute positively to the ecosystem by releasing them into the sea, following a carrying capacity and environmental assessment, particularly when released into coastal waters with strong natural currents. This could shift the conversation from waste management towards ecosystem enrichment.

A Call for Coordinated Action

For Iceland, this is not merely an industry opportunity—it is a strategic development project. Land-based aquaculture can diversify exports, enhance food security, and strengthen rural economies. However, success depends on coordinated action.

Government authorities, municipalities, utility companies, and other stakeholders must ensure that electricity transmission, geothermal distribution, land-use planning, port infrastructure, and environmental management are strengthened and guided by scientific evidence. With these conditions in place, private investment, innovation, and long‑term value creation can follow.

With regulatory frameworks, infrastructure, and government strategy aligned with Iceland’s natural advantages, land‑based aquaculture can become a cornerstone of future economic growth.

Steinþór Pálsson, CEO, Thor Salmon