The Blue Lagoon is one of Iceland’s best known tourist attractions. It’s a popular destination, drawing more than 400,000 visitors every year.

The adjacent power plant, which owns 25 percent of the attraction, may be less interesting to holidaymakers. But its contribution to the success of the Blue Lagoon is considerable.

Albert Albertsson is Deputy Chief Executive of HS Orka, which runs the power plant. He explains its connection with the waters of the Lagoon: “One of the products our company supplies is geothermal brine, extracted from wells 2000-2500m deep and we provide this to the Blue Lagoon spa.

“The Lagoon is well known for its healing powers,” says Albertsson. “And it’s the minerals and salts from the geothermal brine that create the beneficial effects.”

Geothermal fluid is just one of HS Orka’s valuable products, as Albertsson explains: “Our waterworks pump up ground water, to supply fresh water locally to around 30,000 people. We also supply electricity to 60,000 residential customers and hot water for heating.”

POWER TO THE PEOPLE
HS Orka is not the only utilities company in the market, but it has some valuable advantages over its competitors. Customer loyalty is key to its success, as Albertsson points out: “We have two main competitors in the market for supplying electricity and power. While there is not much to separate us in the way of price, we were the first company to offer power supplies. In fact, for a while HS Orka was the only supplier.

“We started providing electricity at a time when people had previously been relying on oil and unstable power supplies from the grid. Many of our customers have been with us for a long time and we have built an excellent reputation over the years.”

While HS Orka benefits from the goodwill of its long standing customers, the company has not become complacent. “We have worked very hard at building our customer base and have attracted many new customers too,” confirms Albertsson. “We are customer focused and aim to provide the lowest energy prices we can.”

HS Orka has a clear strategy for maintaining its position in the market. It aims to be the most efficiently run energy company in Iceland and it has identified a number of goals to help achieve its objectives. “Our main goal is to harness abundant geothermal resources in a sustainable way,” says Albertsson. “We also want to continue leading the market in technical expertise.”

And Albertsson has played a significant part in the company’s success in this area. He has been employed by HS Orka for more than 30 years, since the company started up: “I joined the company as an engineer, straight from university, where I studied thermodynamics and nuclear engineering,” he explains.

Albertsson was promoted to Chief Engineer before he was appointed to his current position of Deputy Chief Executive and he maintains a “hands-on” approach, as he adds. “In some ways my job has not changed very much as I am still very much involved in technical development, which I am responsible for.”

NOT IMMUNE TO THE DOWNTURN
Just like many companies around the world, HS Orka has not been immune to the effects of the economic downturn. “When the banks collapsed, it had a knock on effect on our financial position and things were tough for a while,” reveals Albertsson. “But I would say that we are already half way back to where we were before.”

The company’s profit for 2009 amounted to ISK 6,798 million compared to a loss of ISK 11,682 million in 2008. Its most recent results show other signs of growth too, as CEO Julius Jonsson reported: “Despite a difficult year for the Icelandic economy, HS Orka has been able to produce a very positive outcome for this year in terms of profit and an increase in the equity ratio from 16.3 percent to 35.5 percent.”

HS Orka continues to power ahead. “We have ambitious plans for expansion over the next few years,” says Albertsson. “We have 130 employees at the moment and will be recruiting more highly skilled people, as we grow.”

And Albertsson knows just where to find them. “We often employ people who have worked on Icelandic fishing fleets as they are very highly trained,” he says.

“It takes a few years until they are fully up to speed with our business, but they already have a base of experience which is very useful to us. For instance, we work with pumps, valves and turbine generators, which are very similar to those found on board ships, so our line of work is familiar to them in many ways.”

CLEAR COMPETITIVE ADVANTAGES
Albertsson has a clear view of the company’s competitive advantages, which he envisages will continue to stand HS Orka in good stead for the future. “We have many attributes that make us successful. Not only do we provide a reliable source of energy, our human resources are an asset too. We have a core of very experienced and knowledgeable people who have been working for us for 30 years.”

And their input is invaluable. “If they see a bottleneck in the processes anywhere or any other areas for improvement, they suggest solutions,” Albertsson says.

External input is appreciated too. “The company has been working closely with consultants since the early stages, to help get it off the ground and we are continuing to work with them now as we move into our next phase of expansion. We have been working with them for decades, so they know our business well.”

The HS Orka team, both internal and external, has interesting challenges ahead. “One of our main plans for the future is to go deeper underground to get higher temperature steam and we are also planning to move into extracting valuable metals from the brine.” Albertsson explains. “We’re like Indians. When they kill an animal they use absolutely every piece of it and we’re the same.

“We want to make good use of all of the valuable resources we extract and to ensure nothing goes to waste.”