Hydro-Energy and Sustainable Development: A Foreign Policy Perspective

Reykjavik, 19 September 2003.

Hydro-Energy and Sustainable Development: A Foreign Policy Perspective

A Statement by Ambassador Gunnar Pálsson, Director, Department of Natural Resources and Environmental Affairs, Ministry for Foreign Affairs, Iceland, at a Seminar on "An Outline of a Hydrogen-Society"

In case you wondered whether a diplomat might not be out of his depth addressing a seminar on hydrogen, let me try to make my main point up front: to transit successfully to the hydrogen-society, we need to work at several levels at once, business to business, region to region, country to country, as well as in the international arena.

If that sounds self-evident, let us remind ourselves how different circumstances were only fifteen years ago. During the Cold War, Icelandic leaders were fond of quoting the words of Joseph Stalin that "no one can be blamed for geography being what it is". In an era of military confrontation and arms-racing, geography exercised a powerful constraint on the way our foreign policy was made. All major foreign policy decisions were guided by the bipolar context of East-West relations; you knew beforehand who your friends and foes were. Needless to say, our circumstances were not unique in this regard.

Iceland}s geographic position has not changed. We are still here. But instead of being seen as an impediment, our country}s strategic location is nowadays more often viewed in terms of the opportunities it has to offer.

For example, in the times of the Cold War we seemed blissfully unaware of our neighbourhood to the North. The barren areas of the Arctic were variously viewed as a wildlife reserve only or as playground for military giants to test their submarine prowess. This is no longer the case. As international relations have thawed, the Arctic is defrosting, both literally and figuratively, before our very eyes. At the same time, our foreign policy, like that of our neighbours, has acquired a new dimension.

Our Northern neighbourhood, the Arctic region, possesses some of the richest resources in the world, including oil and gas and precious metals. It is endowed with some of the most important seas for commercial fisheries on a global scale. Last but not least, the Arctic region contains the world}s greatest deposits of its most precious resource, water, a resource increasingly scarce. In brief, there are new and exciting possibilities for co-operation in the circumpolar and subarctic region that ideological and military rivalries prevented us from exploiting fully before.

At the same time, the environment of the Arctic is one of the most vulnerable to the polluting effects of an economy relying on fossil fuel for energy. Mercury contamination, to mention one example, is of growing concern. Increasingly, the sources of this pollution are found far afield, even as far as Southeast Asia. The effects of global warming are also being felt throughout the Arctic, where temperatures are rising at twice the global average, glaciers are melting and the whole ecosystem is changing at an accelerating pace.

Climate change, one of the most important issues under study in the Arctic Council today, will affect every aspect of life in the region in decades to come. As we adapt to the consequences of climate change, we must also find ways of mitigating its possible anthropogenic sources. In Iceland, we can to some extent show the way in adopting eco-friendly energy solutions.

Climate change will also create new opportunities in areas like shipping. Around 90% of world trade tonnage is transported by ship and traditional trade routes, such as the Suez Canal, are approaching maximum capacity. New sea transportation routes through the Arctic Ocean would be 40% shorter in distance and two weeks shorter in time than either the Suez Canal or the Panama Canal routes.

However, as I just mentioned, the Arctic is a vulnerable environment and a large-scale increase in diesel emissions associated with shipping could prove prohibitive from an environmental standpoint. An alternative fuel source, like liquid hydrogen, might be needed. By harnessing its hydro-resources, Iceland is creating conditions for generating affordable liquid hydrogen for use as bunker fuel.

There can be little doubt that energy and water will in the future pose some of the greatest challenges to world resource management. Around two billion people do not have access to electricity today. To meet the demand of a swelling and increasingly urbanized world population for energy will bring greater pressure to bear on all energy sources, including fossils. Not least for this reason, must we look for innovative solutions and promote as best we can the sustainable development of energy sources internationally.

Conditions for pursuing that goal may now be more favourable than they have ever been. Last year, the Johannesburg Plan of Implementation recognized the key role that harnessing renewable energy resources can play in combating poverty and achieving sustainable development. It also called on the international community to increase its investment in both research and development in various energy technologies.

Abundant hydro-resources and national awareness of the need for clean energy are not by themselves sufficient to herald Iceland into the new age of the hydro-economy. Cooperation with other countries and international corporations is needed for developing the necessary technology and applications. Building an international consensus for eco-friendly energy solutions is also indispensable in order to accelerate technological innovation and lower production cost. Hopefully, the International Partnership for Hydrogen Energy to be launched in Washington this coming November will be a major milestone in that regard.

To conclude: Iceland}s commitment to developing sustainable energy resources and its long-term interest in developing the hydrogen economy should be viewed in an international perspective. Icleand}s transition to the hydrogen economy will not happen in isolation from the world at large. We need and we must work with others to make this an integral part of a global agenda if we are to succeed. The contacts we are establishing at this seminar with our guests from Canada and the United States are certainly a welcome and promising step in that direction.