From the
Chair of the Board

Gylfi Magnússon

The history of Reykjavik Energy, OR, is not only the history of an expansive company, but also the history of urban development in Iceland. The utilities that OR now operates were crucial for the development and urbanization of the capital area, and have greatly improved the living conditions of its residents. Without water and sewage systems, and later electricity, the modern era would not have begun its journey. It took great effort to lay the foundation for these systems, even though they were small compared to the ones in use today.

Bold steps

Since this time, many important steps have been taken, some quite bold. The district heating system was a huge project for its time, and undeniably a fortuitous one. At first, it was based on the utilization of low-temperature areas, but later it was possible to harness high-temperature areas in Hengill, both for heating and the production of electricity. All these projects were not only enormous financially, but also at the very limit of what was technically feasible at the time.

Almost a quarter of a century ago, the predecessor of Reykjavik Fibre Network began operations. This was crucial for the development of the national telecommunications system, and ensured that it was based on both the latest technology and fierce competition. As a result, residents’ and businesses’ access to high-speed internet connections is now among the best in the world. That market continues to be in rapid development.

OR's latest subsidiary is no less progressive than the others. Carbfix is a global leader in the development and application of solutions to address global warming. This is in line with previous steps that have been taken within OR to improve living conditions and living standards through ingenuity. For over a century, the history of OR, and the company's predecessor, has been intertwined with the history of a revolution in living standards in Iceland. And still is. OR's activities are of great importance to the residents of the company's area of operation, in fact to all citizens, and will continue to be so.

Changes in leadership

We are now seeing considerable changes in the leadership of OR. Last year a new board took seat, and this year Sævar Freyr Þráinsson will take up the mantle as CEO from Bjarni Bjarnason. Bjarni became CEO under extremely difficult conditions about 12 years ago. The collapse of the financial system and the Icelandic currency in 2008 had badly affected OR's economy. Its equity had almost been wiped out during those upheavals. The owners had to provide credit for the company, and strict austerity measures were put in place.

Through the support of its owners and the concerted effort of OR’s management and employees, the company was steered out of these difficulties. Now its financial position is stronger than ever, and equity has reached ISK 246 billion ISK, which is an increase of more than ISK 200 billion from what it was after the crash.

The turnaround has been incredible, and OR is well-positioned to face the challenges that lie ahead. They are great and include expected investments of around ISK 184 billion for the period 2023 to 2027. They will be in all areas of operations. An increase in the population calls for investments in infrastructure, but increased requirements in environmental matters, including energy exchange and the structure of Carbfix, are also a large factor.

The work of the board in 2022

Reykjavik Energy’s board held 14 meetings in 2022. Following the Covid pandemic, most board meetings have been mixed, meaning that board members have either been present or have attended remotely, and signatures of board members have all become electronic. In addition to the meetings, the board held a working day in February where, among other things, the board engaged in its regular evaluation of its work. An annual evaluation of the CEO's work was also conducted.

There were an unusual number of owner meetings during the year, or five in total. In February and August, there were meetings regarding changes to the organizational structure and ownership of Carbfix, a regular owner's meeting on finances was held in December, and the general meeting was divided into two parts. The reason for this was changes in how the City of Reykjavík manages its ownership in companies. The election of the board was therefore postponed from the general meeting, which was held in April, to the secondary general meeting in December.

Thanks for the collaborations

Dr. Brynhildur Davíðsdóttir remained chair of the board of Reykjavik Energy until the secondary general meeting, but she decided not to stand for re-election. She has held a seat on the board since 2011, serving as its chair since 2016.

As I give thanks to Reykjavik Energy’s board members, its leaders, and all the group‘s employees for their excellent work in 2022, I would like to give a special thanks to Brynhildur for a long and good collaboration on the board of Reykjavik Energy.

I would also like to thank Bjarni Bjarnason for the collaboration in recent years, and his part in leading the company from great strife and into the strong position it enjoys today.