At approximately 1.5 degrees latitude south of the Arctic Circle, Roni Horn is reclining on the grass in the warm Icelandic sun. “This is more like Florida to me,” she says, waggling her feet in the air, and she seems very content. She worries, sometimes, if days like these portend the heating of the planet, but then only two weeks ago in Stykkishólmur, this tiny coastal town on the west of the island, a blizzard blew in with “these huge, just huge snowflakes”, and then she thinks that things might be normal after all.

Horn hasn’t gone native. Her father ran a pawn shop in Harlem, New York, and, still based in the city today, she retains the New York swagger and drawl. Yet soon after she graduated from university, in 1975, she decided that her first journey outside the United States would be to Iceland. More than 30 years later, and after having returned again and again to the island to tour about and to make art, Horn is back once more to open an eccentric and possibly very important work of public art.

The Library of Water, or Vatnasafn in Icelandic, is many things at once, but at heart it’s an archive: housed in the old library in Stykkishólmur, it comprises 24 glistening tubes of water that descend from the ceiling like a phalanx of stalactites and contain hundreds of litres of water tapped from the island’s glaciers.

A pale, khaki-coloured rubber matting covers the floor to provide a ground for them, and incised into it are words in English and Icelandic that might almost describe both people and weather (“foul, torrid, sultry . . .”). It’s a place to document where weather and humanity meet.

It has a great charm, resonance and ingenuity, yet you might worry about the logic that has produced it. You certainly hesitate to greet it as a breakthrough: Darren Almond and Simon Faithful, among many others, have ventured to icy extremities in the past few years, and with some of these works you get the sense that the artists have flown to beautiful frozen wastes to make work that speaks of the urgent need for us to stop flying to beautiful frozen wastes. Wouldn’t it be better if we all just stayed at home?

Horn recalls when she first came: “None of the roads were paved,” she says. “There was no commercial expression at all. If you could find a place to eat you were lucky.”

Nevertheless, while quietly developing into one of the most respected conceptual artists of her time, Horn has kept on coming, seduced by the island’s astonishing scenery, and she has made several bodies of work – photographs and text projects – all devoted to aspects of the country. “In retrospect,” she has said, “I see that I have chosen Iceland the way another artist might choose marble as the substance of one’s work.”

Horn is something of a mini Icelandic celebrity, and this month, to coincide with the opening of the library, she is being honoured with a survey of her Icelandic projects at Reykjavik’s surprisingly impressive Art Museum.

It is signs like this that make one warm to Horn's new library – she knows the terrain. “There are all kinds of water in Iceland,” she explains. “Hot water, glacial water, fresh-water springs, salt water, everything, but it occurred to me that the glaciers were the key water, the old water, and so I decided to get the key glaciers of Iceland, and the ones that are in danger of disappearing – like Snaefellsjökel, which is the glacier-covered volcano that Jules Verne identified as the entrance to the centre of the earth.”

But Horn also wants the library to service locals – not simply the few art pilgrims who might venture out there – and to that end it has been devised as a community centre: her sculptural intervention has been delicate, positioning the watery poles so as to divide up an otherwise empty space into two rooms. A fund has been created to establish annual chess camps in the town to promote women’s involvement in what is effectively the national game; and accommodation has been created downstairs for a writer-in-residence.

The library also has another dimension, as a kind of memorial weather vane. Horn commissioned a series of interviews with locals about their experience of the weather, and they are being published in a book as well as forming the basis of a developing archive on the library’s website. She sees these conversations about the weather as a kind of collective self-portrait. “That idea of talking about the weather and talking about yourself – a peculiar kind of reflection occurs. Some people ignore the weather, refuse it, but people get killed on the ocean all the time here, and I think there is a stoicism that the weather has enforced upon the people.”

Horn first had the idea for something like an archive of water many years ago, but it wasn’t until James Lingwood and Michael Morris, of Artangel, began to discuss with her the possibility of a project in Iceland that the present installation began to take shape. For more than 15 years Artangel has pioneered some of the most innovative public art projects in Britain, producing Rachel Whiteread's House in 1993 and Jeremy Deller’s Battle of Orgreave in 2001, but in 2005 it established a new commissioning fund to enable it to support projects internationally. Horn’s Library of Water is the first fruit, and the proper trumpet blast for their inter-nationalisation, as not only is the library far, far away, but it speaks on the theme that unites us all as a globe – the environment.

But Horn sees these things locally and globally. She has joined many – even Björk's mother – in speaking out against development in the Highlands, the area of Iceland’s interior which is considered Europe’s last wilderness, and she is wryly amusing in talking about the natives’ own green consciousness. “The only reason Iceland isn’t destroyed is because the population is so small,” she says. “Actually, I think the weather has stopped Icelanders from destroying themselves. Now that it’s nice it’s getting scary!”

So does Horn want the world to come and see her library? Probably not, for she realises just how fragile is Iceland’s climate. “Why would you go into the heart of Icelandic culture – in my mind, this symbol? You don’t even have to go there, it’s just so exquisite.” The same, surely, applies to the Library of Water.

Library of Water, Stykkishólmur, Iceland (www.libraryofwater.is)

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