UPDATED: Grímsvötn eruption closes Keflavik Airport near Reykjavik Iceland (but seems to be calming down)

Update: "Grimsvötn eruption – frequently asked questions (and some speculations on flying)"
Original post:
From Iceland Review:

Largest Volcanic Eruption in Grímsvötn in 100 Years

The current volcanic eruption in Grímsvötn on Vatnajökull glacier is the largest in that volcano 100 years and larger than the one in Eyjafjallajökull last year. It is similar to the eruption of 1873, according to geophysicist Magnús Tumi Gudmundsson. A large flood is not expected.

The current eruption in Grímsvötn is larger in scale than the eruption in Eyjafjallajökull in 2010, according to geophysicist Magnús Tumi Gudmundsson. Photo of the eruption in Eyjafjallajökull by Bjarni Brynjólfsson.

This morning the ash cloud was 15 to 18 kilometers high which means that the volcanic eruption is ten times more powerful than the last eruption in Grímsvötn in 2004, Gudmundsson told ruv.is.
However, it is not unique. Grímsvötn goes through phases where it erupts often in a period of 60-80 years, then there are quieter periods of equal length.

In these quieter phases there are small eruptions such as the ones in 1998 and 2004 and then the third and fourth eruption are larger in scale, like in 1619 and in 1873, which is similar in character as the one we’re experiencing now.

It is much larger with much more magma flow and much more emission of ash than what we witnessed in the volcanic eruption in Eyjafjallajökull last year. The ash scatters widely and the ash cloud stretches over a large part of the country....MORE

The government appears concerned about the potential hit to tourism. Again, Iceland Review:

The Eruption is Retreating

Grímsvötn volcano in the middle of Vatnajökull glacier is the most active volcano in Iceland. Since 1920 the eruptions have been in 1922, 1933, 1934, 1938, 1945, 1954, 1983, 1998 and 2004. Many of the eruptions have lasted from one to three weeks, the 2004 eruption lasted only four days.

Eruptions in Grímsvötn often lead to floods in Skeidará. In 1996 an eruption occurred in an area between Grímsvötn and Bárdarbunga, a mountain in Vatnajökull. The eruption lead to floods that washed away a bridge over a river. The extent was up to 67 cubic kilometers and the flow up to 40 thousand cubic meters per second....MORE

Official sources:

The University of Iceland Institute of Earth Sciences
The Icelandic Met Office
The Police Civil Defence Agency