Informing resilient recovery in Grindavík in Iceland

Impacts include direct damage to housing and infrastructure as well as disruption of services and economic loss. The residents of Grindavík have had to evacuate repeatedly between 2023 and 2025, leading to community stress, temporary outmigration, and business disruption. Critical assets in or near Grindavík—such as the Svartsengi Power Plant’s geothermal/pipe and power line infrastructure and the Blue Lagoon tourism hub—are susceptible to volcanic and earthquake impacts. The area more broadly has experienced disruptions to road accessibility and telecommunications. 

A key output of the assistance provided was an advisory report which analyses current risk information, identifies key challenges, and makes recommendations for resilient recovery planning in Grindavík. This work was led by a team of experts from the World Bank Group and the Global Facility for Disaster Reduction and Recovery, who drew on desk research, analysis of international experience (with some 30 cases reviewed), and in-country and online consultations with stakeholders, including representatives of central government agencies, local authorities, civil society, and the private sector. A key country counterpart was the Grindavík Executive Committee, which was formed to support the recovery of the community and to support the municipality in carrying out necessary works related to recovery. 

The advisory report makes seven key recommendations, organised across four key areas: policy and governance; safety and preparedness; people and social infrastructure; and critical Infrastructure and economy. Among these, a central recommendationis that a resilient recovery framework is essential to enable authorities and other stakeholders to recover in a manner that is risk-informed, gradual, and inclusive and that contributes to public safety, trust, and social cohesion. Such a framework can help guide risk-informed actions by public institutions and the private sector, including utilities, businesses, households, tourists, and workers. Given the prevailing uncertainty, a risk‑informed and phased approach, linked to evolving risk information and aligned with international experience of prolonged volcanic crises is recommendedThe advisory report also provides short and medium-term policy priorities. Beyond presenting several international examples, the assistance also showed application of participatory approaches to articulate acceptable levels of risk and to show how data and statistical analysis can inform policymaking.