Act No. 70 on Climate Change.

The objective of the present Act is: a) to reduce the emission of greenhouse gases in an economical and efficient way; b) to increase the sequestration of carbon from the atmosphere; c) to promote adaptation to the consequences of climate change; d) to create conditions for the government to fulfill Iceland's international obligations in climate issues; and e) to achieve carbon neutrality no later than by the year 2040. It applies to all types of activities on land, in the atmosphere and the economic zone of Iceland that may affect the emission of greenhouse gases. The Act consists of 47 articles divided into the following chapters: I. General provisions; II. Climate Action Plan and Adaptation to Climate Change; II.A. Climate Council, government climate policy and climate change impact report; III. chapter Iceland's emission accounting; III.A. Climate commitments until 2030; IV. Greenhouse gas emissions from local activities; IV.A. Special rules for certain establishments; V. Greenhouse gas emissions from aviation activities; V.A. Monitoring of carbon dioxide emissions from maritime transport; V.B. Monitoring, certification and reporting of operators and air carriers; VI. [deleted]; VI.A. Registration system; VII. [deleted]; VII.A. Monitoring and reporting under the ICAO system; VII.B. Innovation fund; VIII. Auction of emission allowances; IX. Climate Fund; IX.A [deleted]; IX.B. Public procurement of ecological and energy-efficient vehicles; X. Generally about emission allowances in the EU trading system; XI. Access to information and confidentiality; XII. Fee collection; XII.A. Administrative appeals; XIII. Coercive measures and sanctions; XIV. Final clause. The Appendixes are: Appendix I. Emissions from local operations; Appendix II. Emissions from aviation activities.
The Act charges the Executive with the obligation to elaborate an action plan on climate, where measures are to be put forward to reduce the emission of greenhouse gases and increase carbon sequestration in this country. This plan shall be revised no less often than every four years, taking into account international commitments and the stated goals of the government. The Act creates a Climate Council, whose main role is to provide the government with restraint and advice on Iceland's strategic decisions and goals related to climate issues, and regulates its functions. The Environmental Agency shall keep records of greenhouse gas emissions and carbon sequestration from the atmosphere. The Act also creates a Climate Fund, whose function is to support innovative projects in the field of climate issues and projects related to promotion and education about the effects of climate change.
The Act establishes that, from 1 January 2021 to 31 December 2030, greenhouse gas emissions shall be reduced as a minimum in the categories of energy, industrial processes and chemical/product use, agriculture and waste, with the exception of greenhouse gas emissions from activities covered by the scope of the EU emissions trading system. The Executive shall issue a regulation stipulating the annual reduction in greenhouse gas emissions in Iceland. Emissions and sequestration that fall under the category of land use, land use change and forestry shall not result in net emissions. Special rules are laid down for operators who carry out activities mentioned in Annex I and thus fall under the scope of the EU emissions trading system according to what is stipulated in this law.