The thing about battery is that you can take the energy out of it. It stores energy. That's the entire point of a battery. How on earth can you do that with Bitcoin? If you can't, Bitcoin isn't a battery, it's a black hole.
But the extra money is of no help to the climate. From an Iceland's point of view, the alternative to using excess geothermal to Bitcoin mine is (i) build smaller geothermal power plants which have even smaller carbon footprints to build/maintain or (ii) reduce the carbon footprint of other countries by courting their energy-intensive industries with low cost renewable electricity.
The bitcoin network (and all PoS) schemes incentivize waste beyond merely throwing away power: they incentivize e-waste, frivolous cooling and refrigerant use, &c. It's strictly better to just dump excess capacity than it is to use it on PoS schemes.
Edit: to make the analogy more complete: a bitcoin is, in effect, proof that energy has been wasted. Using a bitcoin to purchase renewable power from a windfarm is tantamount purchasing that power with empty batteries or empty oil drums.