Iceland has large resources of hydroelectric power and geothermal energy. It is unique in that it produces nearly all its electricity from emission-free, sustainable natural resources. Iceland is a world leader in the use of renewable energy. While many cities struggle with soaring energy costs and the burdens of pollution, due to a reliance on limited energy supplies like oil or coal, nearly 90% of homes in Iceland are heated with geothermal water. Geothermal steam has been used directly for a number of industrial processing applications in Iceland for decades, such as vegetable farming in greenhouses. It has also been developed for electricity generation on a small but growing scale. Natural conditions in Iceland favour the use of hydropower for the generation of electricity.