Hydrothermal Power Plant - the lagoon sits atop a high temperature geothermal zone which supplies hot water through out this whole area to heat homes, etc. The steam and hot water is pumped up through boreholes and cooled down to 70 degrees C in the power station you see in the background, then released into the Blue Lagoon. The water has medicinal effects on the skin. It has an associated new bathouse with all kinds of spa facilities. Vacationers and certainly many of the locals spend hours in the lagoon.