HOT ROCKS: Svartsengi geothermal power plant provides heat, power and mineral-rich hot water to the "Blue Lagoon" spa.
©Scientific American / Christopher Mims

REYKJAVIK, ICELAND—Snorri Sturlusson is the first name in geothermal development here. That's because this original Icelander tapped Earth's heat for a pool in his backyard, according to the medieval Icelandic Sagas. That pool, recently restored, still sits atop a grassy hill in the town of Reykholt. It's about 15 feet (4.5 meters) across, perfectly round, paved with gray and brown basalt tiles, and as warm to the touch as it was when Snorri built it almost a thousand years ago.

Sturlusson's modern-day descendants are striving to follow his example, especially the president, Ólafur Grímsson, who travels the world extolling the virtues of geothermal power. From the warm water that heats this capital city to the "Blue Lagoon," Iceland is dotted with efforts to harness the volcanic power beneath its rugged and often stark surface.

Slide Show: View Iceland's Majestic Geothermic Scenery

Video: Iceland Geothermal Power

The island itself is basically a blister of porous basalt at the crack in Earth's crust where the North American and Eurasian plates are pulling apart. It possesses two of the traits dearest to geologists in search of exploitable geothermal power, according to power company Reykjavik Energy: enormous underground reservoirs of water that are continually renewed by levels of annual precipitation that range as high as 177 inches (450 centimeters) over Iceland's glaciers, and shallow plumes of magma that heat the deepest reaches of these reservoirs to temperatures in excess of 750 degrees Fahrenheit (400 degrees Celsius).

Plus, nowhere else other than the Great Rift Valley in Africa is seafloor spreading visible on land, says Richard Hey of the University of Hawaii. This constant generation of new crust makes the country one of the most geologically active on Earth. And it is that activity the Icelanders are trying to tap.

Home heat
Historically, Icelanders used Earth's heat directly for washing and baking the "hot spring bread" known as hverabrauth. In 1930 water from boreholes drilled into geothermal springs in Laugardalur, just east of the capital city of Reykjavik, was piped to Austurbaer primary school about two miles (three kilometers) away.

Whereas district heating in Iceland is straightforward—naturally pressurized "low temperature" geothermal fields containing potable water at temperatures less than 300 degrees F (150 degrees C) are common throughout the country, according to Reykjavik Energy, the regional power authority that includes Iceland's capital city—it wasn't until the first oil shock of the early 1970s that Icelanders got serious about exploiting their native energy resources. Ásgeir Margeirsson, CEO of Geysir Green Energy, says that at the time homes in Iceland were almost entirely dependent on oil heat.

By financing thermal and electric power plants throughout the country, as well as the infrastructure required to deliver hot water to homes, the Icelandic government not only eliminated the country's dependence on fossil fuels for heating and electricity, but also jump-started an entire industry, according to Alexander Richter, Director of Sustainable Energy, Global Research and Communication at Glitnir Bank.

Iceland is now the leading exporter of geothermal expertise to the rest of the world, according to the Trade Council of Iceland. The nation's engineers, geologists and financiers work on projects anywhere there are incentives (as in Germany, which has a feed-in tariff on geothermal of 20 cents per kilowatt-hour) or easily-tapped reservoirs of underground heat (as in the Philippines). Iceland's third-largest bank, Glitnir, helped finance the world's biggest geothermal district heating project in the city of Xianyang, China, and it retains a staff of geologists to evaluate the potential of early stage drilling projects, such as one it financed in Nevada, Richter says.