Iceland-UK Interconnector: A Brief Analysis of Possible Political Risk Mitigation and Dispute Settlement

• Main Authors: Andri Dan Traustason, Hilmar Þór Hilmarsson
• Format: Article in Journal/Newspaper
• Language: unknown
• Subjects: Iceland
• Online Access: http://www.jami.org.ua/Papers/JAMI_5_1_66-74.pdf

The proposed interconnector between Iceland and the United Kingdom carries numerous and different types of risks for Iceland. This article focuses on political risk. Ownership of the interconnector and related infrastructure needs to be settled in a way that minimizes political risk for the Icelandic nation without sacrificing national sovereignty over its clean energy sources. A public-private partnership could use various methods to mitigate risk. International institutions, such as the Energy Charter Organization and the International Centre for Settlement of Investment Disputes (part of the World Bank Group) could provide a basis for international arbitration in the event of dispute. Other solutions, such as bilateral legal agreements and contracts for difference, are also assessed with regard to the interconnector in addition to some financing options. political risk, risk mitigation, cross-border investments, cross-border financing, international business