The Government of Iceland has granted the IDDP3 project in Nesjavellir, a collaborative project between Reykjavík Energy, Landsvirkjun, HS Orka and the government, ISK 309,695,500 through the Climate and Energy Fund . The goal of IDDP3 is to drill deeper into the earth and utilize geothermal energy at higher temperatures, potentially multiplying the output of each geothermal production well in the coming years. Drilling of IDDP3 is scheduled to begin by the end of 2026.
“It is highly encouraging to see the government demonstrate clear support for deep drilling and a strong ambition to keep Iceland at the forefront of geothermal development,” says Sævar Freyr Þráinsson, CEO of Orkuveitan. “If we succeed in harnessing geothermal resources above 400°C, it will represent a major step forward for the future of sustainable energy worldwide.”
“The benefits of harnessing energy from deeper and hotter layers of the Earth are substantial: higher output, more energy-rich fluids, less environmental impact, and, importantly, improved energy efficiency. Using our natural resources more effectively is one of the most important challenges we face,” says Hera Grímsdóttir, Chief Research and Innovation Officer at Orkuveitan.
“Deep utilization represents the third generation of geothermal energy development globally, and we are extremely proud to lead IDDP3 with our outstanding scientific team and through close international collaboration. We are grateful for this generous support from the government and very excited to begin drilling at Nesjavellir.”
The Government of Iceland chose 11 geothermal projects that will be receiving a total of ISK 600 million (approx. USD 4.82 million) in grants . Initially announced in December 2025, the funding aims to support Iceland’s competitiveness in the field of geothermal energy utilization by promoting innovation and technology development.