Hydropower

Authors: Tokula Enekwu-Ojo Josephine, Linet Kerubo Ogoti, March, 2025  

1      Description and History

Hydropower, also refered to as hydroelectric power, utilizes kinetic energy in falling and flowing water to generate electricity where “Hydro“ is a Greek word meaning water.^1-3 Although there are other energy sources related to water bodies like tidal currents, temperature differences in seawater and ocean waves, hydropower is traditionally refered to the power generated from damming rivers using turbines.¹ Hydropower is considered one of the oldest if not first renewable energy sources exploited and used source of mechanical power.⁴ By 2015, hydropower had contributed between 15.4% and 20.3% of the world’s annual generated electricity serving as a vital and key renewable energy source.⁴

1.1  Components, Classification and Working Principle

Electricity generation by hydropower technology can be achieved by different technologies, such as, run-off-river plant, pumped storage system or reservoir and hydroelectric dams.⁵ Typically, a hydropower plant system has storage, transport, mechanical, electrical and collection components.⁵ Water as the transport component, runs into the system through an inlet and flows out through an outlet.⁵ The inlet leads to the power station which holds the electrical and mechanical components for generation.⁵ Storage components, such as dams, are built for various reasons, including flood control, irrigation, public water supply, and hydroelectricity.²

The classification of hydropower plants varies from country to country depending on the respective sites, where water source and sizes are considered.⁶ When considering the size, a hydropower plant can be classified as mini, micro, small or large depending on the generated power in KW or considering the vertical distance between the turbines and the water level as low, medium or high head.¹ With the basic components and classification in mind, the working principle involves falling water from the reservoirs or dams which forces the turbine blades to turn hence rotating the turbines.² The generator, connected to the turbine, consequently rotates and generates electricity as the generated electricity is then transmitted by power lines from the power stations.²

1.2  History

Water power is believed to have been in used as early as 4000 BC in Mesopotamia for farming although the interpretation of evidence is ambiguous and insufficient.⁴  However, reliable evidence is found dating back to the 1^st millennium BC found in a Greek poem dated 85 BC and some writings in Roman texts indicate that water power was used to pump water and grind grains.⁴ Discovery of water wheels in Egypt between the 2^nd and 3^rd centuries BC was found in the Egyptian papyri.⁴ During the 1^st century AD, China used basic wheels to drive mills and grind grains and by the 2^nd century, Asia and Europe had adopted the use of waterpower wheels which were in use alL through to the 19^th century where the hydro turbines were invented.¹ Hydropower had now gained more popularity and by the 20^th  century, it was the popular form of electricity generation.¹ With the introduction of iron in England in the 18^th century, advancement in more effective and reliable turbines which are still in use today was made.⁴

During the invention of hydro turbines, hydroelectric power from waterwheels in the Fox River was the first to be commercialized in Wisconsin by lighting a house and two paper mills in 1882.^1,2 This was made possible by coupling water wheels with generators as opposed to earlier mills that used wooden paddles.^2,4 The first hydropower plant however was built in France around 1800.^2,7 Few week after Wisconsin, a hydropower plant in Minneapolis was commissioned and later small-scale projects in hydropower were implemented in Indian with its first plant in Darjeeling producing 130KW.¹ Hydropower continued developing in the 20^th century where it became the only vital renewable energy source by late 1900s.⁴ Switzerland had commissioned 7,000 small-scale hydropower stations by 1924 which still contributes to the electricity generation in Europe and to the world, although advancements in technology made it possible to develop large-scale hydropower plants as demand also increased.¹ By 2016, the installed capacity of hydropower was 1246 GW based on data from International Hydropower Association (IHA), with 27,000 generating units and 11,000 hydropower stations.⁴

1.3  Relevance

Hydropower is a significant form of renewable energy as it is cleaner compared to fossil fuels and is currently regarded as a cheaper source of energy.¹ Further, hydropower is categories as a renewable energy source as it relies on the sun‘s energy where regenerative hydrological (water) cycles emanate thus their sustainability and renewability.⁶ Most of the hydropower plants in the early years were built to supplement nuclear energy to ensure it runs at full capacity and just as before, excess electricity during low demand periods is stored  for utilization during high demand and currently for renewable energy balancing to the grid.⁴ Hydropower among other renewable energy sources have offered vital support in the reduction of carbon emissions compared to energy from fossil fuel and delivers to about 17% of the total global energy supply.⁵

The potential for hydropower is very important as it has many advantages over other energy sources and its estimated resource is about 5,000 TWh which is not restricted to resources depletion due to its promising and well developed technical and economic potential.^2,5 It is also estimated that with the utilization of hydropower resources to replace coal plants, an annual GHG emissions reduction of about 5,000Mt of CO₂ will be achieved.⁵ Further, some part of the world like Africa have the greatest need for reliable and sustainable energy sources to support development.⁶ Hydropower poses some effects to the environment and the society despite the numerous advantages hence need for keen assessment to ensure sustainability and profitability.^2,5,6

2      Economic Performance

Hydropower is considered a reliable, crucial and efficient electricity source which can be quickly stopped or started depending on the demand that causes grid fluctuations.⁸ Hydropower projects promote economic expansions although large and small hydropower projects have different constraints.¹ Technology has played a major role in the reduction of hydroelectricity cost over the last decade where more development and market expansion has taken place.⁸ Hydropower is clearly an economically feasible technology from a study carried out on 175 countries where, 150 of the countries have hydropower resources in which 10 of the counties depend entirely on hydropower, 24 countries have 90% of their electricity from hydropower and 65 countries have 50% of their grid power from hydropower.¹

2.1  Hydropower Cost and Electricity Price

Hydropower is considered an affordable renewable energy technology despite its initial high cost as compared to other energy sources like fossil fuel that require continuous supply of fuel.⁹ Combustion plants that require coal, oil or gas heavily depend on the cost of these fuel which is also the case for nuclear plants that depend on the cost of the nuclear fuel.⁹ On the other hand, hydropower plants depend on the water current flow which occurs naturally reducing the operation and maintenance cost of hydropower as compared to other energy sources.⁹ The cost of building a hydropower plant can thus be divided into capital investment which involves civil work, mechanical and electrical components,  or operation costs involving subsidies, manpower and interest rates.^8,9 Hydropower has huge investment costs that ranges from 1300$/kW to 8000$/kW for small hydropower and 1050$/kW to 7650$/kW for large hydropower with storage, which can also be as low as 500$/kW where dams may already exist, noting that small hydropower may cost even more.^3,8 The implementation cost depend on the location where civil works take about 50% of the ultimate cost, 25 to 40% of the cost goes to mechanical and electrical components and lastly 5% goes to steel construction while the operation costs take about 1% to 3% of the initial investment.^3,8

The cost of electricity depends on; maintenance and operating costs of the power plants together with the market prices determined by marginal cost of generators.⁹ With time, renewable energy has had major effects on the electricity markets due to its high investment cost and low maintenance and operation cost while traditional power sources in turn have higher operation cost.¹⁰ Electricity cost has over time has been used to determine the type of power plants to invest in through the extrapolation of market trend in consumption and prices across all relevant sectors.⁹

2.2  Growth and Development of Hydropower

2.2.1      Revenue Growth

The growth of hydropower globally has been driven by the increasing energy demand and economic development goals since hydropower offer valuable output despite the indication s of low returns in the market.^4,11 In Cambodia for example, hydropower contributes to the economic growth as more investment in hydropower is done to reduce electricity price and avail power to rural areas.¹² Another growth contribution by hydropower is surplus energy generation for exportation in Laos where about  26 GW is exported to Thailand.^11,12 The growing demand in China has necessitated dam construction in Lower Mekong whereas countries in the Mekong Basin aim to produce more electricity for exports, job creation and revenue generation.¹¹ Hydropower is the most commercialized and vital renewable energy that has been in use for decades which accounts for 85% of the total renewable energy globally. Contributing about two-thirds of the world’s hydropower capacity is; the united states, Russia, India, Canada, China, Brazil, and Norway.¹⁰

The Levelized Cost of Electricity (LCOE) of different energy sources are comparable to hydropower LCOE particularly for the renewable energy sources that shows the revenue as compared to the investment.^8,9,13  Hydropower has a lower LCOE compared to fossil fuel thermal plant of the same size where the estimated hydropower LCOE in 2018 was 0.047 $/kWh making it the most affordable electricity source in most markets.¹³  The LCOE of hydropower and geothermal increased as compared to that of biomass, solar PV, concentrating solar power, offshore wind and onshore that reduced when compared in 2017 and 2010 where hydropower still showed affordability among all sources.⁸ However, LCOE estimates for 2025 for the renewable energies are: 36$/MWh, 40$/MWh, 37$/MWh, 122$/MWh, 95$/MWh, 53$/MWh for solar PV, onshore wind, geothermal, offshore, biomass and hydropower respectively.⁹

2.2.2      Market Trends and Expansions

The initial peak of hydropower in the market was early 1950s which levelled off and peaked again in 1970s but much earlier in Norway between 1970-1974.¹⁴ Due to hydropower‘s economic feasibility, investment in hydropower is considered an international business as more projects in developing countries are now financed by foreign international companies.¹⁵ The market potential for hydropower globally has resulted in designing of environmentally viable turbines by many manufacturers.⁹ Hydropower market has been expanding and gaining popularity over time and by 2002, environmentally friendly turbines were already being tested.⁹ For future hydropower development, the estimated annual investment for dam construction is 220 billion dollars which does not include operation costs and returns.¹⁵

2.2.3      Economic Effects of Hydropower

Hydropower has several economic benefits like cheaper electricity provision and employment opportunities for revenue generation as it also brings regional cooperation, resource management and supports social, environment and econimc issues.¹⁶ The environmental impacts of hydropower has effects on the economic aspects where over time more investment is made to cater for environmental compliance which began in 1996 where 63.5 million dollars was used  to mostly take care of fish passage.⁴ Laos, Vietnam and Cambodia use hydropower to address unemployment, high energy demand and exportation for revenue growth and lowering electricity price by encouraging growth of small enterprise especially in Cambodia.¹² Employment creation comes from both end of direct opportunities like in material transportation and industrial employment.¹⁶

Despite hydropower’s contribution to economic growth, it has negative effects on the society and environment which has been recognizes by the hydropower industry and plans to have turbine designs that favours the environment, technology and economy have been put in place. ^2,12

3      Ecological Performance

As of 2016, hydropower was the leading renewable and clean energy source globally accounting for about 71% of the total power mainly because of the developments in North America and Europe  in the 20^th century.¹⁷ With the growing demand for electricity, construction of dams with five times the current capacity is crucial in providing about half the projected demand by 2040.¹⁵  Developing hydropower was technically viable since the 1970s where the industry shifted to developing countries and put up huge hydropower projects.^15,17 Despite the importance of hydropower, these developments have ecological impacts like deforestation, destruction of rivers‘ ecology, greenhouse effects, population displacement, and lose of aquatic lives.¹⁷

3.1  Ecological Performance in Comparison to other Alternatives

3.1.1      Environmental Performance

Despite hydropower renewable energy technology being one the lead, it has adverse environmental effects like river fragmentation resulting to the restriction of organisms’ movement, change of water current flow and temperature profile, altering the quality of water and consequently affecting agriculture, deforestation, and flooding at low altitude areas.¹⁵With the construction of large dams, hydropower affects the ecosystem which might cause the migration of aquatic life, wildlife and human beings.^10,15 Greenhouse effect of hydropower was considered a challenge in 1990s and later in 1993 traces of methane gas emitted by reservoirs and dams were noted.¹⁸ While countries with existing hydropower technology experience these ecological adversities, prioritizing dam construction on already fragmented rivers, as opposed to free-flowing ones, can reduce these effects since hydropower remains a vital clean energy source, known for its zero-carbon electricity generation.^10,15,18

3.1.2      Available Resources

Hydropower relies on the availability of water and it is largely affected by dry seasons as it performs really well during seasons with high precipitation and reliable water flow.¹⁰ The decision to explore this resource is however made on from the economic perspective as opposed to the ecological impact this will have.^10,12 With the different ecological impacts of renewable energy sources, resource distribution differs all over the world with an example of Africa that has significant energy potential ranging from hydropower capacity, solar irradiation, and wind resource.¹⁹ Africa’s solar intensity is quite reliable compared to other continents with Namibia having about 2500 kWh/m² annual potential although this has not been fully exploited yet.²⁰ Wind intensity is reliable in the South, North and East African regions whereas geothermal along the Great Rift Valley of Kenya, Ethiopia and Uganda.²⁰ On the other hand, Ethiopia and Congo hold high potential in hydropower of about 45,000 MW by 2016.²⁰

3.2  Evolution of Hydropower Ecological Impact

3.2.1      Aquatic Ecosystem

The aquatic ecosystem has been affected by unfavorable conditions caused by the venture into hydropower where dams influence water current flow thus oxygen level and temperature.²¹ Reservoirs often cause warm temperatures which reduce the concentration of oxygen that does not support the aquatic community.¹² The unconducive environment affects fish migration, reproduction, and inadequate habitat as seen in Cambodia following dam construction that also affected the community that depend on fishing for income.^12,22 Hydropower has affected the water quality through emissions which risks the existence of aquatic life together with the community depending on it.¹² Dam construction in areas like Congo, Amazon, and Mekong which are rich in biodiversity, pose a risk to high-value to fish.²³ Changes in the water flow disrupts the whole ecosystem by altering the water quality and favoring algae growth.^24,25 Hydropower development has negative ecological effects like decreased fish population, algae growth, and deforestation, calling for sustainable measures in plan and implementation to reduce these impacts.²² However, efforts to control erosion and aquatic life depending on the area of reservoir construction are being made in the hydropower industry to maintain water level for habitats conservation.²²

3.2.2      Climate Change

Hydropower reservoirs contribute to climate change through release of greenhouse gases, particularly carbon dioxide and methane whose intensity vary with location.¹⁵ Future dams in tropical areas are likely to have higher initial emissions due to high decomposition rate of submerged organic matter releasing these greenhouse gases.^13,15,18 These emissions that are still lower than fossil fuels happen mostly during construction although studies have suggested that emissions may be more than those of fossil fuels for bigger reservoirs.^13,18 However, on average hydropower releases about thirty times less of these greenhouse gases compared to coal with hydropower emitting averagely 21g CO₂ eq/kWh that is less as compared to biomass, geothermal, solar, gas, and coal.^13,15 In 2018, hydropower lifecycle greenhouse emission was 18.5g CO₂ eq/kWh, compared to 48g CO₂ eq/kWh, 490 g CO₂ eq/kWh, and 820 g CO₂ eq/kWh for solar, gas, and coal respectively.²⁶ Hydropower generation however is vulnerable to climate change as precipitation changes and drought effects water availability.^10,12 Despite these effects, hydropower plays a role in the reduction of emissions associated with fossil fuel and grid stabilization hence a balance must be made between its importance and impacts on the environment.¹⁵

3.2.3      Human Beings

Although hydropower affects human beings positively through employment and water supply, it has adverse effects on the community like loss of life and property during floods, displacement, and increased exposure to natural disasters.^12,15 For instance as from research study in Cambodia, people settled along Se San river experienced severe food insecurity, loss of income, loss of property and life after floods during Yali Fall test.¹² The effects of hydropower to water quality cause health problems to the community and limits access to clean water.²² When dams are constructed, indigenous communities displaced from their land lose touch with their traditional resources leading to social inequalities.¹⁵ Due to nontransparent dam construction approvals and environmental insights especially in tropical areas, hydropower affects the ecosystem that in turn affects agriculture and jobs.²³ Through human interventions in planning and studies, modern efforts on water improvement techniques to ensure reduced negative impacts of hydropower to the community have explored.¹⁰

In summary, hydropower has ecological impacts ranging from deforestation, destruction of resources, destruction of the aquatic ecosystem, emission of greenhouse gases and displacement of people.^12,15 To prevent these negative impacts, proper planning and technological advancement is crucial for the conservation of aquatic species and widespread ecological damage, and to ensure the development of hydropower for sustainable energy goals to replace fossil fuels without affecting the ecosystem and social well-being.^16,23

4      Social Impact

The acceptance of a hydropower project largely depends on the active participation of three key stakeholders: project developers, government, and local communities. When each party effectively fulfills its respective responsibilities, local communities are very likely to support hydropower development in their region. Ensuring early engagement, awareness campaigns, and inclusive decision-making processes that allow local communities to contribute to project planning can significantly enhance public acceptance and minimize resistance to the project.²⁷ Hydro power plants are generally considered as economic and sustainable source of energy. While hydropower project development brings about many benefits, such as clean electricity, economic growth, employment, and water management, it also has great social and environmental consequences, affecting people’s lives, causing displacement, bridge to indigenous human rights, and community health.^28-30 Castro-Diaz et al concluded that natural, social, human and financial capital are negatively affected by dam construction while physical capital is mostly affected positively because construction companies benefit directly from these projects such as roads, hospitals and schools.³¹ This section explores the positive and negative social impacts of hydropower development in different communities, based on real-world case studies and research evidence.

4.1  Positive Social Impacts of Hydropower Development

4.1.1      Economic Growth and Job Creation

Hydropower projects generate employment during construction, operation, and maintenance. These projects brings a positive impact on capacity and skills development within the organization developing the initiative and also generates new revenue streams that can be used to support social facilities and initiatives.²⁹  Hiring local labor force for the construction and maintenance of a hydropower plant and supporting the community by returning profits to the community is one of the ways to reduce the concerns of installing a hydro power plant in a community.²⁷ According to Energy Sector (ESMAP) of World Bank, hydropower sector has provided about 2.36 million jobs globally. It was noted that 64% of these jobs were associated with manufacturing while 30% were associated with construction and installation services. The remaining 6% were under operation and maintenance (O&M) services. Topping the list of Job creators in the hydropower sector is China with about 37% contribution to the global hydropower Job market and followed by India with 18%. These Jobs promotes on-the-Job learning; formal education opportunities and skills development.³⁰ The Kariba and Grand Coulee employed about 10,000 and 15,000 workers respectively.³²

Additionally, increased electricity availability stimulates industrial development, promoting long-term economic stability. Many hydropower companies strive to achieve favorable Environmental, Social, and Governance ratings by fostering a positive corporate image through long-term community benefits. This often involves investing in infrastructure improvements, such as healthcare, education, transportation, tourism and sanitation facilities, as well as ensuring sustainable water resource management. Additionally, companies may assess how reservoirs can be utilized for broader community needs, including irrigation and navigation, to enhance local livelihoods and promote social acceptance of hydropower projects.^33 30

4.1.2      Electrification and Improved Living Standards

Renewables such as wind, Solar and Hydro energy are necessary to developing sustainable power generation for communities with low access to power. Small off-grid hydroelectric installations can effectively electrify rural communities which has less environmental and social impacts.³⁴ One of the key advantages of hydropower is its ability to provide stable electricity access to rural and urban areas. A survey conducted by Rojanamon et al for the Nan province of Thailand shows that a great number of people in the community support a hydropower project in their village because they are not satisfied with the standard of living in their community. The community believes that a hydro project would help develop their community and raise the standard of living in their community.²⁷

4.1.3      Water Security and Flood Control

Hydropower reservoirs contribute to water storage and regulation, benefiting agriculture and reducing the risk of droughts and floods. Hydropower scheme is also called a multi-purpose scheme as it is not limited to only generation of electricity. It can also be used in flood control, where water can be temporarily stored during peak periods of flood and released when maximum flow has passed.³⁵ The Aswan High Dam in Egypt has enhanced water security for many people living around the structure, allowing all year-round irrigation and protecting communities from the Nile’s seasonal flooding.³²

4.2  Negative Social Impacts of Hydropower Development

4.2.1      Displacement and Resettlement

One of the most significant negative impacts of hydropower projects is the forced displacement of individuals from their communities. Large dams lead to loss of Land and involuntary resettlement of locals. An example is the Three Gorges Dam located in China which is the largest dam in the world, it caused around 1.3 million people to be displaced, this dam has displaced the largest number of people so far resulting in economic hardships, loss of cultural heritage, and social disintegration.³¹

Majority of the displaced individuals are not resettled or rehabilitated. Often, compensation and relocation efforts fail to fully restore displaced communities’ livelihoods or are delayed and even when paid on time, has in many cases failed to restore the lost livelihoods.³⁶ The World Commission on Dams case study gives many examples of failed and delayed compensation and Resettlement, an example is the Dam project in the northeast Thailand were about 15,000 farming families were left without Lands as a result of failed resettlement schemes between 1960 and 1970.³²

4.2.2      Impact on Indigenous Communities

Hydropower projects threaten indigenous populations by altering their traditional lands, destroying Farms and forests, changing river flows, Fishing practices and limit access to natural resources.^31,37,38 Introduction of Hydropower construction in communities could lead to loss of income for the individuals in the community, especially if their major source of income is fishing or water related and would cause a significant change of their way of life. Building large reservoirs can also result in destruction of some major amenities like roads, railways and communication lines in the community and if not replaced will limit the local population.³⁵ The Maraba Dam project of Brazil was estimated to affect over 40,000 Indigenous people in the Amazon and affected the fishing trade of the community. Tropical Dams could also emit a great amount of greenhouse gases including carbon dioxide and methane which contributes to global warming and affects the environment of the communities closest to the dams.³⁷

4.2.3      Health and Waterborne Diseases

Hydropower reservoirs create stagnant water bodies, especially in tropical areas, which can increase the spread of insect-based diseases such as malaria, yellow fever and Schistosomiasis. It also favors the emergence of water related diseases such as dysentery and cholera.³⁵ There is also additional risk of sexually transmitted diseases especially AIDS among construction workers and sex workers. Dams and reservoirs serves as breeding habitats for aquatic insects and snails that that transmits diseases, reservoirs also attracts large number of people for fishing or other related water economic activities and lastly Dams displaces individuals from flooded zones, the aforementioned largely affects and influences transmission of tropical diseases.³⁹  In Ghana, the Volta River Project led to a rise in schistosomiasis cases due to the expansion of slow-moving waters.⁴⁰ Additionally, the alteration of natural river flows can affect water quality, leading to increased contamination risks.³⁵

5      Political and Legal Aspects

Development of hydropower is not only affected by social acceptance, technological advancement and economic benefits but also affected by political/government and Legal regulations. Government plays a critical role in shaping hydropower policies, ensuring that project owners comply with environmental and social standards, and promote sustainable energy transitions. The legal aspect varies depending on countries, as different countries have different views on the effects of hydropower on their people, economy and environment. While some countries tends to accept and create policies that would foster the development of hydropower plants, others enforce laws that limits the expansion of hydropower in their countries.³² For example Polices enacted by the US president in 1930s influenced the construction of several multipurpose projects such as Hoover and Grand Coulee dams which accounted for about 40% of the country’s electricity generation by 1940.³³

Policy, Legal and regulatory frameworks have been in existence before the 1970s particularly for Social and environmental Issues, however many countries updated these policies and regulatory frameworks to give stronger emphasis also to public participation, efficiency and cost recovery.³² Governments are key investors in hydropower projects. Governments worldwide have implemented laws, incentives, and restrictions to shape hydropower development while addressing environmental and social concerns.⁴¹ This section discusses policies and regulations that have influenced hydropower development in different countries.

5.1  International Policies

The Kyoto protocol of 1998 and Paris Agreement of 2015 organized by the United Nations (UN) encourages countries to limit and reduce Carbon dioxide emissions by implementing or elaborating policies enhancing energy efficiencies, research on and promotion, development and increased use of new and renewable forms of energy which includes Hydropower Technology.^42,43    

5.2  Case Study of Turkey

The European Union promotes electricity generation from renewable sources which includes hydropower. The measures put in place by the EU to promote transition to renewable energy are Feed-in tariffs, quota obligations, tenders and energy tax exemptions. The EU encourages member states to integrate more renewables, including small-scale hydropower stations. Turkey as a member state of the EU is expected to employ laws compactible to EU regulations and policies and adopt policies to improve its renewable energy market. Small Hydropower is regarded as one of the most stable and economically clean renewable energy alternatives in Turkey, to increase the share of renewable energy in Turkey’s energy sector Laws and regulations were published. This includes the Electricity Market Law of March 2001 which encouraged private investments to build and operate hydro power plants and the Renewable Energy Law of 2005 which sets a price of 5.5Eurocent/kWh to facilitate more involvement of private investors,⁴⁴. Turkish laws have only two Legislation that is relevant to renewable Energy sources. One is the Electricity Market licensing Regulation and two is the Law on utilization of Renewable Energy Resources for the Purpose of Generating Electrical Energy. The main aim of the second law is to increase the use of renewable energy for electricity generation which includes Hydropower.⁴⁵

5.3  Case Study of China

China has employed different policies to facilitate rapid hydropower development. Firstly, national-level development and energy policies, such as the ‘Develop the West Campaign’ and the ‘West-East Electricity Transfer Project’ which fosters the use of local natural resources including rivers to elevate economic growth. Secondly, since mid-1990s, China’s state-owned power companies had started to aggressively investigate expansion policies, policies that mandated companies to develop Corporate Identities and pursue profit. Thirdly, the Chinese government enacted the Renewable Energy Law in 2005 to address international pressure to reduce greenhouse gas emissions, this Law marked hydropower as the center piece in China’s clean, renewable energy development Blueprint.⁴⁶ In China, different agencies such as the state council, national Energy Administration (NEA), the national development and reform commission (NDRC), Ministry of finance and Ministry of Environmental Protection (MOEP) have formulated policies for development of hydropower in China since 2012. Policies such as the Energy Development Plan which emphasis the importance of hydropower development and promote development of different types of hydropower stations were introduced by the State Council, this gave the overall planning of hydropower development. Furthermore, policies supporting the transfer of approval rights of hydropower construction to the Local government were established. In 2013 China’s Western Development Program was issued which promoted the building of large Hydropower bases and hastened the construction of the Hydropower base in West-East electricity transmission project. Between 2013 and 2014, other policies were introduced by NEA and NDRC to further solidify the construction and implementation of hydro power stations, also policies affecting the on-grid price formation mechanism of pumped storage power stations were formulated to ease and  encourage construction of pumped storage hydropower stations.⁴⁷

5.4  Case Study of HKH Countries

Hussain, A. et al describes the different policies that has shaped hydropower development in the four Hindu Kush Himalayan (HKH) countries which includes Bangladesh, India, Nepal and Pakistan. Political boundaries in the shape of countries have shaped the management and utilization of hydro-resources by implementing different policies and strategies. Bangladesh introduced the Private Sector power Generation Policy and National Energy policy in 1996 to foster private investment and economic growth. Renewable Energy Policy was also established in 2008 to increase and promote use of Renewable Energy sources which includes Hydropower. India established various policies to foster Renewable Energy sector in general which includes Electricity Act 2003, National Electricity Policy 2005, Tariff policy 2006, Rural Electrification Policy 2006 and the Hydro Power Policy in 2008 to promote Hydropower as an action towards mitigating Climate change. Nepal’s Energy policies are administered by the Ministry of Energy, the first hydro power development Policy was established in 1992, this policy promoted private investments in hydropower development. The Hydropower Policy was also established in 2001 which generates electricity at low cost by using the country’s water resources and developing hydro power as an exportable commodity. Subsequently, Renewable Energy policies 2006 and 2009, Renewable Energy Subsidy Delivery Mechanism 2010 and Renewable Energy Subsidy Policy 2013 were formulated to expand the power sector in sustainable and environmentally friendly manner. Finally, Pakistan’s Ministry of Water and Power is responsible for implementing all energy-related policies. The national power policies of 1995, 1998, 2002, 2013 and 2018 focused on improving use of local resources like water for power generation and encouraging private investment.  The vision 2025 Policy is aimed at completing two major hydel Dam projects to eliminate its electricity supply-demand gap and cater to growing future demand.⁴⁸

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