Harnessing the untapped potential of small hydropower for sustainable development
Aerial view of a river in North Macedonia (Image: Petar Avramoski via Unsplash). 

Harnessing the untapped potential of small hydropower for sustainable development


Insights into the global challenges and potential of small hydropower.

By Eva Kremere

Hydropower generates electricity by harnessing the energy of flowing water, generally from large-scale artificial damns, and is defined as a renewable energy. Small hydropower (SHP) works on the same principle, but typically harnesses rivers or streams to generate up to 10 megawatts.1 Unlike large-scale hydropower, it has a much lower environmental impact, low up-front costs, and can provide energy to remote or low-density communities where major installations and infrastructure would not be commercially viable. Representing a mere 1 per cent of the world’s total installed capacity, SHP is a renewable powerhouse with much room to grow.

The World Small Hydropower Development Report 20222 is the culmination of an extensive collaborative effort involving more than 200 local authors and SHP experts from around the world. Each expert contributed a detailed report on SHP in their respective countries, providing a unique and comprehensive perspective on the global state of SHP. A dedicated board of 20 members and 20 peer reviewers, renowned in their fields, rigorously vetted the content to ensure the highest standards of research and analysis. This collaborative approach lends credibility to the report and offers a diverse and holistic view of SHP development across different regions and contexts.

Global overview

The global overview of SHP underscores its contribution to sustainable development and energy security. It also reveals its potential for scalable and adaptable local and international energy solutions. This analysis of SHP’s international impact helps to craft effective strategies and foster the collaborations that are essential for maximizing its role in sustainable energy progress. The viability of SHP is contingent on the presence of running water, making natural resources a key factor. Notably, SHP harnesses the kinetic energy of flowing water without consuming the water itself, meaning no water is lost in the process. Arid regions with limited waterways have less SHP potential, but innovations like conduit SHP, which utilize urban water systems, offer a viable alternative. These solutions exemplify SHP’s adaptability to different environments and recommend its place in the global energy mix. Additionally, for arid coastal areas, wave and tidal hydropower can be explored as renewable energy sources, capitalizing on oceanic movements.

Share of global small hydropower potential of ≤ 10 MW by continent

Source: UNIDO, ICSHP (2022). World Small Hydropower Development Report 2022

There are broad continental disparities in SHP development. Asia is well ahead of the pack, due to favourable policies and geography, accounting for 64 per cent of global installed capacity for plants of up to 10 MW (see figure above). Europe, benefiting from well-established infrastructure, is nevertheless a distant second with 18 per cent. In terms of estimated SHP potential – based on an assessment of water availability and other geographical conditions – Asia has developed 36 per cent (50,406 MW out of 139,946 MW) of its potential capacity, followed by Europe with a commendable 52 per cent (20,434 MW out of 39,607 MW potential) – although this is skewed towards Western Europe, which has developed 83 per cent of its SHP potential.

Africa, on the other hand, has harnessed less than 5 per cent of its vast SHP potential. This is largely due to economic and infrastructural constraints, which could be mitigated through targeted investment and technology-sharing. At the regional level, the largest known untapped SHP potential is concentrated in Central Asia (only 1 per cent developed), Eastern Asia (61 per cent developed) and South-Eastern Asia (4 per cent developed) (see figure below).

Developed and remaining small hydropower potential of ≤10 MW by region

Source: UNIDO, ICSHP (2022). World Small Hydropower Development Report 2022

The narrative in Oceania diverges, with Australia and New Zealand rich in SHP potential but with no further development foreseen, while the Pacific Island Countries and Territories face topographical constraints. This geographic diversity underscores the unique challenges and prospects faced by each region in tapping into SHP.

Analysing the social dimensions of SHP – including gender dynamics, youth engagement and climate resilience – is crucial to ensuring that the sector’s growth aligns with broader societal goals. Empowering women within the SHP industry fosters inclusivity and leverages diverse perspectives for better decision-making. Engaging youth ensures the sector’s longevity and relevance, as they offer innovation and adaptability. Addressing climate resilience within SHP projects not only mitigates environmental risks but also secures the livelihoods that depend on these energy resources. These factors are fundamental to realizing SHP’s potential as a force for sustainable and equitable community development.

As the report shows, each region faces its own challenges in fully tapping its SHP potential. Overcoming these challenges begins with an assessment of SHP resources and the possibilities offered by existing infrastructure. Developed countries also reassess their SHP potential, considering new technologies and ecological shifts. A thorough understanding of the landscape can then inform strategies and policies, tailored to each region’s own needs.

Some general recommendations, however, would include extending renewable energy incentives to SHP, with streamlined permitting and clear development targets. De-risking investment should be a key financing strategy, as well as raising SHP awareness among local financial institutions. Trade policy could help facilitate access to technology through reduced import duties and taxes, while infrastructure improvement could support SHP integration and reduce distribution losses. Policymakers might consider microgrids for remote areas, with SHP as a base-load power source. Local expertise is a key enabler of technology adoption, and countries could invest in skills development in the areas of feasibility studies, construction, operation and maintenance of SHP plants. Finally, international and regional bodies have a role to play in promoting SHP, focusing on new technologies and financing models, and especially in promoting South-South and triangular cooperation on shared goals.

The World Small Hydropower Development Report 20223 is therefore a call to action for localized and global efforts to realize the full potential of SHP. By investing in this sector, we invest in a sustainable future that balances energy needs with environmental stewardship and social inclusivity. The untapped potential of SHP is a clarion call for policymakers, investors and communities to come together to power a greener tomorrow.

  • Eva Kremere is expert in small hydropower projects at the Division of Climate & Technology Partnerships of the United Nations Industrial Development Organization (UNIDO).

Disclaimer: The views expressed in this article are those of the authors based on their experience and on prior research and do not necessarily reflect the views of UNIDO (read more).

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