Debunking myths about electricity providers
At Straumlind, we are constantly answering questions about what it is we actually do. We also regularly hear all kinds of “facts” about our business that are, in reality, myths.
We therefore decided to compile a few of the claims we hear most often and explain whether we agree with them or consider them myths.
“Privately owned electricity retailers increase prices for consumers”
At Straumlind, we would unequivocally say that this claim is a myth.
State monopolies in any market, including electricity markets, are not known for delivering lower prices or better service to consumers.
Healthy competition, whether it takes place entirely between private companies or among a mix of private and publicly owned companies, encourages market participants to attract customers through lower prices, better service, and greater operational efficiency.
In 2025, the Icelandic electricity regulator published a detailed report on Development of Electricity Costs and Their Impact on Consumers. The report clearly demonstrated that the markup on electricity sold to residential consumers, in other words, the difference between wholesale and retail prices, declined significantly once genuine competition began to develop in the Icelandic market. In fact, the reduction accelerated dramatically when Straumlind entered the market. We are certainly pleased to see that!
“Publicly owned electricity retailers offer consumers lower prices”
In the view of Straumlind, this statement is also a myth, although it is an incredibly widespread one.
We understand why many people assume this to be true. How could it be otherwise when the publicly owned electricity retailers are by far the largest players, received power generation assets as a form of “founding endowment,” and have been operating the longest? Shouldn't their scale, ownership of generation facilities, and experience result in greater efficiency and lower prices for consumers?
Perhaps the answer should be “yes.” Unfortunately, however, the reality is that even though all of the above is true, these companies generally offer significantly higher prices than smaller and newer electricity retailers that have no such advantages.
Consumers can compare electricity retailers’ prices on the website of Orkusetur, an independent institution operating under the Environment and Energy Agency of Iceland. Orkusalan, ON Power Retail, and Orkubú Vestfjarða are all publicly owned electricity retailers.
“Electricity retailers are unnecessary middlemen who do nothing”
Readers who have made it this far can probably guess that we at Straumlind consider this to be a major myth. That said, we readily admit that it is not always easy to explain the role and function of electricity retailers.
We like to describe Straumlind as a balancing scale because our core responsibility is balance. We must always purchase exactly as much electricity as we sell, and this applies to every hour of every day throughout the year.
That may not sound particularly difficult, but the challenge is that we need to purchase the electricity our customers will use well before they actually consume it.
The reason is simple: electricity that is being used right now must also be generated right now. For a power plant to know how much electricity it needs to produce each hour, an electricity retailer must have submitted an order the previous week forecasting how much electricity its customers will consume during each of the 168 hours in the week ahead.
As a result, we invest significant time, expertise, and resources into forecasting and planning to ensure that our purchasing decisions are as accurate as possible.
What happens if our forecasts are wrong?
Any discrepancy between the volume of electricity we ordered and the amount our customers actually consume is measured, and we are charged for what is known as balancing energy. Accuracy is therefore absolutely critical to our business.
The Icelandic transmission system operator, Landsnet, provides further information about the importance of maintaining balance in electricity systems and energy markets.
“Switching electricity retailers is difficult and complicated”
This is yet another myth.
Contrary to what many people believe, switching electricity retailers is both simple and secure. It is simple because you identify yourself using electronic ID, and your new electricity retailer handles the rest. It is secure because all switches take place according to standardized rules through a centralized data hub. This central database ensures the seamless transfer of consumers from one electricity retailer to another.
Join us and become a customer of Straumlind at www.straumlind.is.
Why Debunking Myths Matters
All of the myths we have discussed undermine healthy competition in the electricity market. That is why we believe it is important to challenge them through information, education, and open discussion.
We believe consumers want an electricity market that functions effectively and serves the public interest. We want the same thing. That is why it is important to address misunderstandings and correct myths that do not reflect reality.
Change naturally takes time, but we believe that informed, professional discussion will lead to healthier competition, lower prices, better service, and ultimately better outcomes for consumers.