Iceland Takes Hard Look at Tech Boom Sparked by Its Cheap, Bountiful Power

Lawmakers rethink whether a proliferation of data centers lured by the island’s Nordic climate and geothermal steam is risking the environment and tourism business

REYKJANESBAER, Iceland—Steaming geysers, dramatic waterfalls and icy landscapes lure millions of tourists to this country every year. Now its geology is fueling a computer tech boom.

But the voracious electricity demand of Iceland’s proliferating data centers is testing the island nation’s environmental ethos.

Iceland’s Nordic climate and...