South and Central Asia regional overview and outlook
There were promising signs of progress in 2023 in South and Central Asia on largescale hydropower development. The same applies to regional cooperation on water and electricity interconnectivity. Notable steps included the announcement of major PSH projects in India, following the publication of a government guidance note on development. The continued support from multiple governments for the Kambarata 1 (Kambaratatsk) hydropower project in Central Asia was also encouraging. Many governments made announcements on new projects or signed MOUs for large-scale projects, referring to hydropower’s important role in their energy transition.
While not many new projects were commissioned in 2023, many are nearing completion. These include major projects in Bhutan and Pakistan. As many existing assets were built in the '60s and '70s, a great deal of increased capacity has come from the modernisation of existing assets. This continues to be critical in maintaining the region’s electricity systems and water supply.
After project delays, the Central Asia South Asia Transmission and Trade Project (CASA-1000) was the subject of new talks in late 2023. The project will see the enhanced interconnection of Central Asian countries including Kyrgyzstan, Tajikistan, Afghanistan and Pakistan. The World Bank also announced it would provide additional support measures for select countries. Many countries are working on regional development projects that will see them share water and electricity, based on existing treaties.
The governments of Azerbaijan and Iran reached an agreement to complete the construction of the Khudaferin and Giz Galasi dams. So far, 96% of the works have been completed. When commissioned, the projects will have an installed capacity of 100MW and 40MW respectively, on the Azerbaijani and Iranian sides. Kyrgyzstan and Georgia signed an MOU in November 2023 to share knowledge of Georgia’s successful energy sector reforms, especially on hydropower. Furthermore, Kazakhstan, Kyrgyzstan and Uzbekistan announced they will create a joint-stock company for the Kambarata 1 hydropower plant.
South and Central Asia policy and market overview
Due to the interconnectivity of water and electricity, the management of these two resources has geopolitical implications for the region. Many countries have tensions based on historical conflicts around water that could affect hydropower development or existing operations. Coordination on water use for upstream and downstream countries will be critical to avoid future conflict. This is even more key with the increased need for climate adaptation to flooding and drought. Across the region, emergency measures were undertaken by multiple governments because of droughts.
Bangladesh experienced severe heatwaves in April to June that forced power cuts to millions due to supply shortfalls. The country faced a daily electricity deficit of ~2.5GW. Rural areas experienced more than 10 hours of load shedding every day. In Uzbekistan, President Shavkat Mirziyoyev issued an emergency decree due to a 10–15% reduction in the volume of the Syr Darya river, while the Amu Darya river was projected to contract by 15–20%. This decree included penalties for wasting water. Both rivers have seen a 90% flow reduction since 1960.
Iran faced its worst water shortages and drought for nearly 20 years. This shortage in electricity has increased the use of hydropower resources. In December of 2023, ISNA reported that reservoir levels were at 40%. These have been dropping further due to overuse of hydropower resources. Outflow increased more than inflow, by 22% to 7%, year on year. There has been limited new generation built, despite the Government’s plan to increase installed capacity by 6GW. Conversely, many countries in the region experienced significant flooding.
Pakistan was heavily impacted by monsoon flooding in August 2023. Over 100,000 people were evacuated from villages in the Punjab province, when the Sutlej River burst its banks. Northern India experienced its wettest day in decades in July 2023, which left at least 22 dead due to flooding and landslides. Hydropower projects faced silt deposit issues from the floods. This caused 1.6GW of capacity to remain offline, and flooding in August caused landslides to kill at least 60 people.
In October 2023, flooding in Sikkim led to 74 deaths and 101 people missing after a glacial lake outburst f lood washed away the 1.2GW Teesta Stage III hydropower project. All bridges downstream of the Teesta V hydropower station were destroyed and the flooding led to overtopping at the dam. The 500MW under-construction Teesta VI project site was also impacted.
Floodwaters entered the powerhouse and transformer cavern, with bridges washed away. After the flooding in Sikkim, India’s Central Electricity Authority issued slope stability guidelines for hydropower projects to prevent future disasters.
As discussed in the climate topic section within this report, all these developments underline the need to invest in climate adaptation and resilience for existing hydropower projects. The increased prevalence of drought and floods also points to the need for more water infrastructure. If there are to be more dams and reservoirs for water management reasons, then these should be powered where possible to get extra benefit from the investment.
Latest developments
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Albania
Norwegian energy giant Statkraft announced in September 2023 that it is evaluating the possibility of expanding the hydropower fleet on the Devoll river cascade, by adding a new PSH facility. The expected capacity of the plant will be around 1,200MW. The reservoir will exploit the natural flat morphology of the upper part of the valley, located around 8km east of the existing Moglicë Dam. The feasibility study phase is expected to end in 2024. The implementation phase could start as soon as 2025, with the plant reaching commercial operations by 2030
Angola
The 2,070MW Laúca hydropower station in Angola, constructed by ANDRITZ, is now fully operational, contributing to the country's energy supply and socioeconomic development, with plans for a green hydrogen project in partnership with German companies. Angola is also embarking on ambitious hydropower projects like the 2,172MW Caculo-Cabaca hydropower station in collaboration with China. It is also aiming to connect to the Southern African Power Pool to enhance regional power integration and meet growing demand.
Argentina
Argentina’s 750MW Río Grande de Córdoba plant, the largest PSH project in South America, is set for a major upgrade. Currently operating at only 50% efficiency due to ageing infrastructure, a US$100 million investment aims to modernise the facility, restoring its full operational potential. The 1,310MW hydropower development of the Santa Cruz River has reached 50% of construction progress.
The complex will include the 950MW Presidente Néstor Kirchner plant equipped with five Francis turbines, and the 360MW Governor Jorge Cepernic plant, featuring three Kaplan turbines. Together, they are expected to generate up to 5TWh annually. This large-scale investment, nearing US$5 billion, is 70% financed by the China Gezhouba Group Company Limited, in partnership with Argentine firms. It will supply electricity to over a million homes in the country.
Australia
Australia continues to promote clean energy and to phase out coal capacity, with energy storage playing a critical role in its push towards a renewable energy future in the country. The Queensland Premier has allocated another A$13m in the state budget to accelerate key technical studies to enable a final investment decision to advance the 1 GW/24 GWh Borumba PSH project near Gympie in the state’s south-east.
Queensland’s mid-coast is set to provide 5 GW of storage – enough to supply half of Queensland’s entire energy needs. Stage one of the Pioneer-Burdekin pumped hydro project, said to be part of the largest pumped hydro energy storage scheme in the world (according to Queensland’s premier), was announced in September 2022 and is estimated to be completed in 2032, with the final stage operational by 2035.
Austria
Austria continues to be a leader in PSH development. The local pipeline currently accounts for almost 2.17GW of hydropower and PSH schemes, of which over 1GW is currently under construction. Ebensee, sited on Lake Tarun and developed by Energie AG, achieved a significant milestone last year, commencing its on-site preparatory works. Construction is likely to take four years, with the 170MW variable-speed turbine, supplied by ANDRITZ Hydro, due to begin operations towards the end of 2027. In June 2023, Verbund announce the start of construction work on the Stegenwald run-of-river plant. Once completed, the plant will have a capacity of 14.3MW with an annual expected generation of 73GWh.
Azerbaijan
President Ilham Aliyev outlined in October 2023 that Azerbaijan is seeking to expand its hydropower capacity from 170MW to 500MW within two to three years. He said this progress will represent “another important contribution to the green energy transition
Bhutan
As of August 2023, the 1,020MW Punatsangchhu-II hydropower project was 95% complete. In February 2024, the successful reservoir filling was marked with a ceremony to coincide with the King’s birthday. The project is aiming to commission its generating units by the end of 2024. Meanwhile, the 118MW Nikachhu dam was commissioned in November 2023. Electricity was exported to India in late January 2024.
Bolivia
Bolivia is focusing on advancing several hydropower projects in the pipeline. The Ivirizu hydropower project, comprising two plants in cascade, Sehuencas and Juntas, with a combined installed capacity exceeding 292MW, has reached 82% completion and is expected to commence full operation in March 2025.
Similarly, progress on the Miguillas hydropower complex is underway, consisting of two systems: Umapalca (86MW) and Palillada (119MW). The former has achieved 62% construction completion, while the latter is at 23%. The commissioning of these plants is anticipated for October 2025 and December 2026 respectively
Bosnia and Herzegovina
This Balkan country has recently seen multiple hydropower developments. In June 2023, the China Gezhouba Group commenced construction of the 160MW Dabar hydropower plant, in the municipality of Bileća. The project is expected to have a total cost of €244 million, of which 85% is provided through a loan from the Export-Import Bank of China, with the state-owned power company Elektroprivreda Republika Srpska (ERS) contributing the remaining 15%. The Mrsovo hydropower plant, also
developed by ERS, began construction works in August 2023. The plant will have a capacity of 37MW and total cost will be about €100 million.
Brazil
In 2023, hydropower contributed to 67% of Brazil’s total electricity generation. Throughout the year, the country connected numerous small-scale hydropower projects to the grid, adding a total of 118MW in installed capacity, bringing the total number of operating projects in the country to 1,330. Additionally, 34 projects totalling 438MW are in advanced construction stages, while 70 projects totalling 1,249MW received licensing approval and began construction.
With these developments, over 60% of Brazil's estimated 172GW hydropower potential has already been developed. In addition to new projects, the hydropower sector is actively engaged in modernisation initiatives. In June, turbine No. 3 at the 1,551MW Jupiá plant, operated by CTG Brasil, underwent successful upgrades. Following this, in August, ENGIE Brasil Energia has contracted ANDRITZ for the renovation of the 424MW Jaguara plant.
Burundi
Hydroneo East Africa's call for tenders for the Mpanda hydroelectric power station in Burundi marks a significant step, with plans to supply 10% of the country's electricity through a public-private partnership (PPP) with REGIDESO. This initiative is part of Burundi's broader efforts to bolster renewable energy capacity, also evidenced by upcoming projects like the regional Rusumo Falls plant and the Dama and Siku hydroelectric stations, supported by the International Finance Corporation (IFC).
Cameroon
In May 2024, the first 60MW turbine was switched on at Cameroon's Nachtigal hydropower project. The 420MW project is expected to be fully commissioned by the end of 2024. In April 2023, Savannah Energy signed a Memorandum of Understanding (MoU) with the Cameroon government, marking a significant stride towards the development of the Bini Warak hydroelectric project, a 75MW initiative slated for construction in the northern Adamawa region. Meanwhile, plans are also in motion for the 500MW Kikot hydropower project, envisioned as a joint endeavour between EDF and the Cameroon government under a PPP model.
Canada
Provincial utility BC Hydro released its updated 10-year capital plan, Power Pathway: Building BC’s energy future, which the BC government said will lead to an “unprecedented” level of construction for community and regional infrastructure. This will include generation and transmission to support a significant increase in electrification and emissions-reduction infrastructure projects in a province where 98% of the electricity mix is renewables, the vast majority of that coming from hydropower. The C$36 billion plan includes C$21 billion to sustain existing capital assets, dam safety and reliability.
BC Hydro also announced strong support from a diverse range of current and prospective industrial customers for advancing planning of the proposed 500kV transmission infrastructure from Prince George to Terrace, which will connect north coast industries to the main grid.
Finally, construction on Site C continued and a major milestone was reached: the completion of the earthfill dam, the third hydroelectric dam on the Peace River. Once complete, the Site C hydropower facility will provide 1,100MW of capacity and produce about 5.1TWh of electricity each year. Construction on the project began in July 2015 and all six generating units are expected to be in service by 2025.
Provincial utility Ontario Power Generation (OPG) initiated an extensive 16-year overhaul of the second-largest hydroelectric station in the province, R.H. Saunders Generating Station (1,045MW). During the project, each of the facility’s 16 units will be overhauled, including replacing the turbine runners with newer, more efficient designs. OPG announced that its five hydropower generating stations in Niagara delivered their highest energy output in over 40 years, at 13.2TWh, an increase of 0.5TWh from the previous year and the region’s highest output since 1982. Each year, these plants meet about 10% of Ontario’s energy needs.
In its Action Plan 2035 – Towards a Decarbonized and Prosperous Québec, provincial utility Hydro-Québec announced major investments for infrastructure resilience, energy efficiency and doubling electricity generation by 2050. Approximately 3,800-4,200MW of new hydropower generation will be added by increasing the capacity of existing generating stations and developing new hydropower facilities, including a PSH facility. The investment in the whole programme, of which hydropower is just one element, is expected to be C$160 billion.
Chile
Small and micro projects across Chile increased the country's hydropower capacity by 228MW. The country is also progressing with various hydropower projects, including the pioneering
Espejo de Tarapaca project. This 300MW PSH facility will be co-located with the 561MW photovoltaic solar plant, Cielos de Tarapacá. Moreover, it will operate with locally sourced seawater, standing out as the first of its kind in the country and the region.
China
In 2023 China installed a total of 6.7GW of new hydropower capacity nationwide, including 6.2GW of PSH. Meanwhile, many PSH projects are nearing the stage of commissioning and operation. As of February 2024, China had a total of 49 PSH stations in operation, while a further 27 have been approved and are being constructed. According to a new national policy called ‘Guidance Opinions on Strengthening Grid Peaking Energy Storage and Smart Dispatch Capacity’, China aims to add another 80GW of PSH by 2027. The world's highest-altitude PSH power station has officially started construction in the Yalong river basin. The Yalongjiang Daofu PSH project will have a total installed capacity of 2.1GW and an annual power generation of 3TWh.
Colombia
In 2023, four new hydropower projects were connected to Colombia’s electricity grid, adding a total of 643MW to the country's installed capacity. This brings the Colombia’s national hydropower capacity to 13,206MW, accounting for 66% of the country’s total energy mix.
Furthermore, Colombia is progressing with the development of Ituango plant, its largest run-of-river project with 2,400MW, composed of eight 300MW Francis turbines. Although construction began in September 2010, the project faced delays, notably due to the collapse of an auxiliary diversion tunnel in April 2018. The project is now back on track and expected to achieve full capacity by the end of 2024 along with certification from the Hydropower Sustainability Standard. The estimated investment for this project is US$5.5 billion, with significant contributions of US$1 billion from the Inter-American Development Bank (IDB) and US$650 million from a consortium of international commercial banks and investors.
Costa Rica
Hydropower continued to generate most of the electricity in Costa Rica, although generation was lower than previous years due to drought. State-run utility Instituto Costarricense de Electricidad (ICE) received two hydropower plants that were initiated 20 years ago under a build-own-transfermodel: El General (20MW) and La Joya (50MW). Both plants were operated for 17 years by their respective owners before being transferred.
In addition, the Don Pedro and Río Volcán hydroelectric plants restarted their energy sales to ICE. The combined capacity of 31MW from these plants will reduce energy imports during the dry season and is part of the response to the increase in energy demand in the country.
Côte d’Ivoire
The 44MW Singrobo-Ahouaty hydropower project in Côte d’Ivoire represents a significant milestone in private sector-led climate action in West Africa. With a total investment of €174.3 million, including €90.7 million in loans from AfDB, the project is advancing towards its final stages, with the installation of key structures and equipment underway.
Democratic Republic of the Congo
The 240MW Busanga hydropower plant, a collaborative effort between China and DR Congo, was inaugurated in 2023. Constructed and financed by Chinese enterprises, including China Railway Resources Group and Power Construction Corporation of China, the project is anticipated to produce an average annual electricity output of 1.32TWh. Meanwhile, the Inga 3 hydroelectric project, with a planned capacity of 11,050MW, is slated to be situated on the Bundi river/basin in Bas-Congo.
Currently in the permitting stage, the project is expected to proceed as a single-phase development, with construction commencing in 2026 and commercial operations projected to begin in 2030.
Ecuador
Ecuador experienced significant investment in its renewable energy sector, with Ecoener committing US$200 million towards the construction of two run-of-river hydropower plants, Santa Rosa and El Rosario. These projects, totalling 99MW in capacity, are backed by 30-year power purchase agreements (PPAs) signed with the government and legislative reforms were implemented at national level to attract private investment and facilitate the country’s transition to renewable energy.
Despite only 7% of its hydropower potential being developed currently, Ecuador has 3,069MW under construction and plans for an additional 7,000MW, aligning with its goal of sourcing 80% of its electricity from renewable sources in the next decade.
Egypt
Egypt has entered into an agreement with China Energy to conduct a feasibility study for a proposed 2GW PSH project. The memorandum of understanding outlines plans for China Energy to assess the technical, economic, and financial viability of the project.
Siemens Energy will rehabilitate three hydropower plants at Egypt's Aswan hydropower complex, extending their lifespan by 40–50 years and adding 300MW to the grid. This initiative will stabilise power loads for over 1.6 million residents in Aswan and neighbouring areas, with Siemens also providing training to local engineers and technicians to manage the project's advanced technology
Estonia
The Zero Terrain Paldiski underground PSH project, developed by Energislav, was granted permits in January 2023 and is ready for construction. In June 2023 it secured an additional €11 million of private funds from a group of Baltic companies. This new 500MW/6GWh scheme is one of the EU “projects of common interest” and is supported by the EU’s Connecting Europe Facility.
Finland
Kemijoki Oy is reviewing options for developing Ailangantunturi, a 550MW PSH plant in Eastern Lapland. The company has begun discussions with the local authorities and landowners, and is initiating environmental impact assessments. The work includes a programme of new facilities that could total €3 billion of investment, including €600–800 million earmarked for the Ailangantunturi PSH development. Towards the end of 2023, power company Suomen Voima, which already owns five hydropower plants in Norway, announced its intention to develop a new energy storage project: Noste, in Northern Finland. They will construct up to three small-scale PSH plants, for a total capacity of more than 100MW and a total investment of up to €300 million. This plan funded through a €26.3 million grant made available by the European Commission under EU state aid rules.
Gabon
The Kinguélé Aval hydroelectric project in Gabon has secured its initial disbursement of €134 million from various financial institutions. Developed under a public–private partnership by Asonha Energie, majority-owned by Meridiam, and the Gabon Power Company, the 35MW project on the Mbei River has a construction consortium led by Sinohydro, alongside French firms Artelia and EDF. Additionally, Meridiam plans to establish a biodiversity sanctuary, provide electricity to the village of Andock Foula, and support the Kango hospital with essential equipment.
Georgia
Georgia announced a new initiative to promote renewable energy. This “Business Universal” programme will finance small renewable energy projects, including hydropower less than 0.5MW.
The country also held its first tender for 300MW of new hydropower and photovoltaics in 2023. The European Bank of Reconstruction and Development (EBRD) approved a project safety upgrade at the 1.25GW Enguri hydropower project in October 2023. It will provide €28 million of the extension’s total cost of €35 million. This will include stability works on the dam, rehabilitation of the headrace tunnel, construction of a fish passage and installation of an emergency valve on one turbine penstock.
Germany
The expansion and conversion of the Rudolf Fettweis hydropower plant in Forbach reached a final investment decision in May 2023. The existing conventional storage power plant will be modernised and converted into a PSH plant. Owners Energie Baden-Württemberg estimate that the conversion cost will be €280 million, including the
construction of a new powerhouse to accommodate the 57MW pumping facility, the modernisation of existing electromechanical equipment (71MW), and the modification of the existing Forbach basin to serve as the lower reservoir of the scheme.
Guyana
Guyana holds significant hydropower potential, estimated at 8.5GW. The most notable project under development is the 165MW Amalia Falls hydropower project. Joint venture opportunities were expanded in December 2023 as the government seeks investment partners to move this initiative forward.
India
Across India, PSH projects have continued to advance. In June 2023, NHPC signed an agreement with the state of Odisha to develop a minimum of 2GW of PSH projects and floating solar with a capacity of more than 1,000MW. NHPC also signed an agreement with the state of Maharashtra to collaborate on the development of PSH schemes.
The two parties will work to develop four PSH projects with a combined capacity of 7.35GW. In the state of Gujarat, NHPC sealed an MoU with Gujarat Power Corporation Limited (GPCL) in early January 2024 to develop the 750MW Kuppa PSH project. In Tamil Nadu, Adani Green Energy announced they will invest INR 245 billion in three PSH projects that will have a combined capacity of 4.9GW over the next five to seven years. In addition, the state’s government has approved 12 PSH projects under public–private partnerships.
The World Bank agreed a loan of US$200 million to Himachal Pradesh in June 2023 to support the addition of 10GW of new renewable energy through the Himachal Pradesh Power Sector Development Programme. This is key to the state’s aim to derive 100% of its power from renewables by 2030. Hydropower provides 80% of its energy supply at present.
In October 2023, the Chief Minister of Madhya Pradesh laid the foundation for a 1.44GW PSH project that will make use of the existing Gandhi Sagar Reservoir, scheduled to be commissioned in 2025. Greenko’s 1.68GW Pinnapuram PSH project is at an advanced stage, with full operation planned before the end of 2024. In August 2023, the Government of India and the state of Arunachal Pradesh came together to agree a plan for 12 hydropower and pumped storage projects totaling 11.5GW.
SJVN announced their intention to build 5GW of hydropower projects in the state, signing an agreement with the Government in August 2023. In November 2023, Minister Shri R.K. Singh indicated that a total of 13 projects will add around 13GW of hydropower in the state, while highlighting that India’s power demand will double by 2030.
Indonesia
The Indonesian government is under increasing pressure to meet its climate pledges and tackle the environmental issues that have regularly accompanied its development initiatives. The government has realised hydropower is becoming increasingly important in efforts to accelerate Indonesia's energy transition to reach net zero emissions by 2060.
Indonesia is estimated to have a technical hydropower potential of approximately 80GW, with 6.7GW having been developed. The government aims to add more than 10GW by 2030, with a long-term vision to reach 72GW total capacity and 4.2GW of PSH by 2060. PLN is working on the construction of the Upper Cisokan project, its first PSH plant, on the border of West Bandung and Cianjur.
Although it is yet to enter main construction stage, supporting infrastructure such as road access has been completed. Construction of the largest hydropower project in Indonesia is ongoing. Located in the Kalimantan Industrial Park in Bulungan, the Mentarang Induk project is a 1,375MW hydropower station that will generate electricity from the Mentarang river in Malinau. The plant will connect to the industrial park on a 300km transmission line by the end of 2029. Kayan Hydro Energy is resuming the development of a 9,000MW hydropower project in North Kalimantan after a legal dispute was resolved.
Iran
The 176MW Chamshir hydropower project was commissioned in July 2023. The dam is the fifth largest in Iran. With a reservoir capacity of 2.3 million m3 of water when full, it will be the tallest roller compacted concrete dam in Western Asia at 680m.
Iraq
Routine general maintenance work was successfully completed on the Samarra Dam hydroelectric power station in Northern Iraq. The maintenance allows the operator to reduce loads and ensure reliable operation of generating units during peak load.
Italy
Built on an existing water barrage created to regulate the water flow in the rice fields of Northern Italy at a cost of €10m, the Palestro project has been developed by Edison using a crowdfunding programme involving local communities, a first for Italy. With an installed capacity of 3.6 MW on the Sesia river; and generation of 13.5 GWh. This is an interesting example of how retrofitting non-powered dams can create new sources of renewable electricity with strong community buy-in.
Building on the success of the 2022 initiative with the Palestro hydropower plant, Italian utility Edison has inaugurated the Quassolo hydropower plant, boasting a capacity of 2.7MW on the Dora river. This compact yet powerful plant is capable of meeting the electricity needs of approximately 3,000 local households. Development was made possible through a crowdfunding campaign engaging 100 individual investors, with €0.3 million of the total €12 million project investment contributed by local communities. Edison reports that the crowdfunding campaign was exceptionally successful, spanning only 20 days, and the overall project was developed in less than 19 months.
Kazakhstan
Kazakhstan set ambitious goals for the development of renewable energy including hydropower. Achieving these goals requires overcoming its dependence on cheap domestic coal and addressing its lack of flexible generating capacity, which provides ample opportunity for foreign hydropower investments. The Kazakh government developed an action plan to increase capacity by 26GW before 2035. This includes at least 600MW from hydropower to be developed by Samruk Energy.
Kyrgyzstan
Masdar and EDF signed an agreement in December 2023 to support 3.6GW of renewable projects in Kyrgyzstan, including hydropower. Minister of Energy Taalaibek Ibrayev said: “Hydropower is a very important energy source for the Kyrgyz Republic and this agreement will help our nation to strengthen its existing clean energy supply and to develop projects utilising other renewable energy sources.” In March 2023, EBRD agreed to f inance nine small hydropower plants through a US$13.8 million package comprising a sovereign loan of US$8.8 million and investment grant of US$5 million. Part of the financing will be used towards modernising the 7.6MW Lebedinovskaya hydropower project, which was commissioned between 1943-48.
Liberia
The World Bank has committed a sum of US$300 million to finance the construction of a new dam on the St. Paul River in lower Bong County. The project, expected to add 150MW to Liberia's electricity grid, marks a crucial step towards improving access to consistent power.
Madagascar
Hyvity and the Filatex Group have launched ENHY, a collaborative venture aimed at developing, constructing, and operating hydropower plants in Madagascar. With a vision centred on bolstering local, renewable electricity production and enhancing energy independence, ENHY aims to work closely with the Malagasy government and national electricity distributor, Jirama, to realise its goal of developing two hydroelectric facilities annually, starting with projects in the Antsirabe region, and targeting a total capacity of 20MW by 2026.
The Volobe hydropower project reached a significant milestone with the signing of a power purchase agreement between CGHV and Jirama, ensuring essential offtake for the power produced. The project, with an estimated cost of €350 million, is backed by a consortium including Jovena, Scatec, Africa50, and Colas Madagascar.
Malaysia
Tenaga Nasional Berhad is set to build 2.5GW of hybrid hydro-floating solar (HHFS) projects at its hydropower dams. It will initially install 30MW at its Chenderoh reservoir and follow up with work at its Temenggor and Kenyir reservoirs.
Gamuda will establish a joint venture to develop a 187.5MW hydropower plant in Tenom, with the total project cost estimated to be around RM 4 billion (US$850 million). This project, upon completion, will deliver up to 1,052GWh of clean energy annually. It is expected to start construction in 2024, with commercial operation to begin in 2029. In addition, Sarawak Energy started construction of its first 50MW floating solar unit, with plans for more in the coming years.
Mexico
Comisión Federal de Electricidad, Mexico's state-owned utility, plans to refurbish and upgrade seven ageing hydroelectric plants, increasing capacity by an estimated 11MW. These improvements will extend the life of these assets without changing existing reservoir or dam infrastructure. This initiative aligns with Mexico's commitment to reduce its carbon footprint, diminish reliance on natural gas imports, and increase renewable energy.
The Multilateral Investment Guarantee Agency of the World Bank (MIGA) has issued a guarantee of US$536 million for a duration of 15 years to back this work. These plans will be undertaken against a backdrop of severe drought in Mexico. Hydropower output fell by 40% in 2023 to the lowest level since 2017 due to a severe drought that affected 80% of the territory. This has slowed policy developments designed to prioritise energy generation from hydropower.
Morocco
The El Menzel PSH plant near Séfrou is one of the most significant projects in Africa’s pipeline. It is expected to enter commercial operation by the end of 2028, adding 300MW to the grid. The project will enhance the country's clean energy transition by integrating renewable energy sources, improving grid stability, and meeting peak electricity demand, with co-financing secured from the Islamic Development Bank.
Mozambique
Mozambique aims to tap its potential by partnering with an EDF-led consortium to develop the Mphanda Nkuwa hydropower project. Valued at US$5 billion, this initiative aims to harness the Zambezi River's energy, with the first phase set to generate 1,500MW of power.
The country plans to halt its long-standing hydropower supply to South Africa by 2030, redirecting the electricity generated by the Cahora Bassa plant for domestic use. This decision poses challenges for South Africa's electricity supply and the operations of Mozambique's Mozal aluminium smelter, which relies on imported power.
Namibia
The Baynes hydropower project is poised to be a significant addition to Namibia's energy infrastructure, with a planned capacity of 878MW on the Cunene river basin. Currently in the permitting stage, the project is expected to be developed in multiple phases, with commissioning anticipated by 2031.
Nepal
More than 400MW of new hydropower capacity came online in Nepal last year, with the commissioning of the 86MW Solu Dhola (Dudhakoshi) project – Nepal’s first privately developed project – plus the 38.46MW Upper Kalangad, 44MW Super Madi and 40MW Upper Chameliya projects and numerous others. Elsewhere in Nepal, projects in the pipeline have been progressing. In November 2023, the river was successfully diverted at the site of the 140MW Tanahu hydropower project, which is being developed with support from Tractebel and Manitoba Hydro International and expected to be commissioned in 2026.
Druk Green Power began constructing the 26MW Druk Bindu hydropower project, with the groundbreaking ceremony taking place in October 2023. It is due to be completed in 2027. In December 2023, the World Bank and Asian Development Bank (ADB) signed an MOU for a partnership to support the 1,050MW Upper Arun and 635MW Dudhkoshi hydropower projects. Meanwhile, in September 2023, the Government of Nepal accepted a US$6 million loan from the World Bank for a pre-feasibility study of the Upper Arun Project. The IFC reviewed its “Nepal Environmental and Social (E&S) Hydropower Programme (2016 to 2023)” and found that it had benefited 67 hydropower projects producing a total of 3,919MW, with additional projects in the pipeline. As part of the activity, it also included training for local experts, using global best practices.
Nigeria
In early 2023, Nigeria celebrated the commissioning of a 40MW station at the Dadinkowa hydropower project in Gombe state. This project, developed by Mabon Energy and situated at the Kashimbila multipurpose dam site, features two 20MW turbine generators and includes essential transmission infrastructure such as a 132kV switchyard and transmission lines. GE Vernova installed four 175MW Francis hydropower turbines and generators at Mainstream Energy’s Zungeru project. With a total capacity of 700MW, the project is Nigeria's second-largest hydropower plant, poised to contribute approximately 10% of the nation's electricity needs while also providing flood control and irrigation support.
Norway
During 2023, Norway commissioned 20 small hydropower plants, with a total capacity of 96MW and expected annual production of 324GWh, and a small PSH
project of 6.8MW. The most significant of these is the 27.1MW Storåvatn 2 hydropower project.
Pakistan
In December 2023, the Government of Pakistan announced that the 4.2MW Nai Gaj was ordered to be completed in 2024. The 969MW Neelum Jhelum project, which was closed in July 2022 after cracks were discovered in the tailrace tunnel, returned to operations in August 2023 after the tunnel and blockage were repaired.
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Panama
The Changuinola II hydropower project (224MW) is currently in the design phase by developer Bocas del Toro Energy S.A. and is scheduled for completion in 2029. This forms part of the 2020–2034 expansion plan of the country’s national interconnected electricity system.
Paraguay
AFRY, in consortium with Latinoconsult, has secured the contract for planning and supervising the rehabilitation and modernisation of the 200MW Acaray hydropower plant, commissioned in 1969. Additionally, a global vertically integrated Bitcoin mining company has acquired two PPAs in Paraguay, enabling access to up to 150MW of hydropower.
This includes up to 50MW in Villarrica, near the company's existing operations, and up to 100MW in Yguazu, situated close to the 14GW Itaipu dam. Furthermore, Paraguay is advancing plans to utilise hydropower for hydrogen production, with NeoGreen Hydrogen Corp. recently securing a long-term 75MW baseload PPA with ANDE, the national electricity company.
Peru
In Peru, a significant surge in hydropower projects is anticipated, with 21 plants scheduled for commissioning between 2023 and 2028, collectively adding 1,746MW to the country’s energy capacity. Plans are also in place for the Manseriche project, set to deliver a substantial 7,550MW upon completion, with construction expected to begin in 2029 and commercial operation targeted for 2033.
China Three Gorges Corporation (CTG) is actively exploring investment opportunities and potential acquisitions to fortify its presence in Peru. Having acquired the Chaglla plant four years ago, CTG aims to double its capacity in the country, potentially exceeding 900MW. Ardian, a private investment firm, has disclosed its acquisition of a Peruvian hydropower company, adding a fully operational suite of six run-of-river hydropower plants with a combined capacity of 73MW to its portfolio.
Philippines
The Philippines is faced with increasing pressure to strengthen energy security. National policy continues to support renewables, demonstrated by the launch of a Renewable Energy Roadmap. This outlines an ambition to achieve at least 35% renewable energy share in the total generation mix by 2030, and to increase installed capacity to at least 20GW by 2040. The 800MW Laguna PSH project is currently at the permitting stage. It was announced in October 2022 and will cost US$1.3 billion.
In 2023, the national government approved the 8.4MW Maladugao River hydropower plant, which is expected to go online in 2025. A 24MW battery storage facility (BESS) providing ancillary services to the grid also went into commercial operation at the site of a hydropower plant in Ramon.
Russia
There are promising signs that the Russian Government is seeking to expand its hydropower capacity. In April 2023, Krasnogorsk 1 and Krasnogorsk 2 hydropower plants were commissioned, with each having a capacity of 24.9MW for a total capacity of 49.8MW. Several other hydropower projects are planned or being constructed as part of RusHydro’s small hydro programme in the North Caucuses. Modernisation efforts are contributing to hydropower capacity growth in Russia. Upgrades to and replacement of Unit 10 at the Votkinskaya hydropower project increased its capacity from 100MW to 115MW. In early 2024, the Ezminskaya hydropower project saw an increase in efficiency and capacity for three units, raising their capacity from 45MW to 60MW.
In October 2023, Fedor Opadchiy, Chairman of SO-UES, highlighted that the country has only used 20% of its hydropower potential and stated that “this share can certainly be increased.” He also noted that there is roughly 11.5GW of pipeline hydropower capacity (including PSH) which they plan to complete by 2042. This was echoed in December 2023 by the Deputy Minister of Energy, Pavel Snikkars, who outlined that Russia would need to harness more of its hydropower potential to support its agricultural, transport and energy sectors. In January 2024, Deputy Minister Snikkars indicated legislative solutions would be required to expand price limits of the wholesale market, including in the Far Eastern Federal District, where there will be a need for additional generation construction. These actions will be important to reduce deficits of 4.3GW of capacity anticipated across the country. Necessary measures outlined for the development of hydropower include “identifying sources of financing for the construction of new hydroelectric power stations and introducing legal regulation for the creation of reservoirs.”
Rwanda
PowerChina initiated the main construction phase of Rwanda's Nyabarongo II multipurpose project, funded by a concessional loan from China Exim Bank. With a capacity to generate 43.5MW of electricity, Nyabarongo II aims to power at least 43,000 homes and provide water for domestic consumption and irrigation. The Regional Rusumo Falls Hydroelectric Project is nearing completion, marking a significant milestone in the country's efforts to strengthen its power supply.
Led by the governments of Burundi, Rwanda, and Tanzania, the project aims to bring 26.7MW of renewable and low-cost power to the national grids of each country (80MW in total). The project has received support from various stakeholders, including the World Bank and AfDB, highlighting the collaborative effort involved in its implementation.
Senegal
Construction has commenced on the 128MW Sambangalou hydroelectric project in Senegal, with VINCI overseeing the development alongside other partners. The project includes the construction of a dam and reservoir with a capacity of 4 billion m3, providing water for energy generation, irrigation and drinking. The electricity generated will benefit the Gambia River Basin Development Organisation countries, with VINCI Energies installing high-voltage lines.
South Africa
The South African government launched the DWS Hydropower Independent Producer Programme to attract private investment in hydropower. Aimed at addressing the energy crisis and boosting renewable energy, the programme opened bidding on 17 April 2023. Developers are required to submit concept-level designs and supporting information, such as wetlands studies and environmental assessments, but there is frustration over the lack of clarity on how submissions are to be evaluated.
Despite significant investments and efforts, none have progressed beyond the initial stage. In 2023, South Africa faced severe electricity shortages due to the increased breakdown of ageing coal plants. Despite these challenges, investments in the modernisation of infrastructure, such as the Steenbras Hydro Pump Station, have played a critical role in alleviating the impact of the electricity shortages.
Spain
In January 2023, the Chiara PSH plant in Gran Canaria received €90 million in grant support from the European Regional Development Fund. This project is being developed by the local system operator, a unique ownership structure for Europe. Upon completion, the plant will boast a 200MW capacity in turbine mode, 220MW in pumping mode, and a total storage capacity of 3.6GWh. It will also be linked with a seawater desalination plant.
In May 2023, GE Vernova was commissioned to deliver six reversible PSH units for the plant. In March 2023, Iberdrola obtained approval from the Spanish Government for the Valdecañas PSH project. This plant will have a total power output of 275MW and is a hybrid system including chemical batteries with a capacity of 15MW, storing up to 7.5MWh of energy.
The combined energy storage of the battery and hydraulic units will be 210GWh, the equivalent of 5.2 million electric vehicle batteries. The Spanish market has seen some new entrants in the past 12 months. Energo-Pro has purchased ten existing hydropower plants with a total installed capacity of 167MW and a company that has recently applied for the grant of a concession for a new 400MW pumped storage plant. This market expansion was financially supported by a €300 million loan provided J.P. Morgan and Goldman Sachs.
Sri Lanka
Resus Energy has connected the eighth smallest hydropower project in Sri Lanka to the national grid, providing an installed capacity of 2.4 MW and expected to produce 8 GWh annually. The development of hydropower in Sri Lanka is part of the bigger plan to achieve 70 per cent of their electric generation from renewables by 2030.
Sweden
Vattenfall has announced ambitious plans to enhance its hydropower capacity by constructing an additional 720MW. The energy company is engaged in pilot studies to facilitate any investment decisions. This expanded capacity will be achieved through the development and expansion of four hydropower projects: Harsprånget (110MW), Porjus (80MW) and Messaure (150MW) on the Luleälv river, plus Juktan (380MW) on Lake Storjuktan, which may also be the subject of a PSH conversion.
Tajikistan
Construction of the 3.78GW Rogun project continues, with the World Bank enhancing its support with a US$15 million technical assistance package announced in January 2023. The AIIB announced a US$500 million soft loan in March 2023. The Saudi Fund for Development also announced a US$100 million loan for the project in December 2023, intended to finance the construction of the 335-metre-tall dam. In April 2023, President Emomali Rahmon visited and “commissioned” Unit 1, now 38MW, of the Sarband hydropower project. Due to extensive refurbishment and modernisation, the plant has seen its rated capacity of 240MW increase to 270MW, with support from ADB. EBRD and the Green Climate Fund created the US$50 million Green Economy Financing Facility Tajikistan II in September 2023. Up to US$13 million will be provided to domestic f inancial institutions to be lent to local projects. In October 2023, EBRD also pledged to enhance regional connectivity for Tajikistan, including a rehabilitation project to modernise the 60-year Qairokkum hydropower project and provide electricity to 500,000 people. Training to adopt best practices for mitigating climate change in hydropower plant operations was included in the project. Masdar announced a joint venture agreement in October 2023 to target 500MW of new renewable energy projects, including solar and hydropower.
Tanzania
Tanzania's power utility company, TANESCO, has initiated the connection of electricity from the 2,115MW Julius Nyerere Hydropower Project (JNHPP) to the national grid. The JNHPP is being constructed under a joint contract with Arab Contractors and El-Sewedy from Egypt, and the first of its 235MW turbines was activated in February 2024. When completed, the project is expected to double the country's current power output, and it will rank as the fourth-largest dam in Africa and ninth largest in the world.
Tanzania has also secured funding for the 87.8MW Kakono hydropower plant, with the European Union and the Agence Française de Développement jointly committing US$154.9 million towards the project's total cost of US$314.1 million.
Thailand
Most of Thailand’s power generation is fossil-fuel based. The country’s renewable energy mix consists of 30% biomass, 25% hydropower, 24% solar, 13% wind and 8% other sources such as waste and geothermal power. Together, these renewable sources account for approximately 14.9% of Thailand’s total energy mix, though the government aims to increase this to 30% by 2037. Within its alternative energy development plan for 2018–2037, Thailand aims to add 3GW of hydropower to its power system. It also hopes to expand interconnection with neighbouring countries that have significant hydropower capacity. In 2023, the Electricity Generating Authority of Thailand (EGAT) signed a contract with an industry consortium for the development of a hydro-floating solar hybrid project at Ubol Ratana Dam. In total, the company plans to install 15 hydro-floating solar hybrid projects nationwide, with a combined capacity of 2,725MW, to support renewable energy demands.
UAE
Dubai Electricity and Water Authority announced its first PSH project had reached 74% completion in September 2023. The 240MW Hatta site will have a storage capacity of 1.5GWh, with commissioning planned for 2025.
Uganda
The final unit of the Chinese-built 600MW Karuma hydropower plant was synchronised with Uganda’s national grid in 2023. Financed largely by China, the project is vital for meeting Uganda's increasing electricity needs.
United Kingdom
The UK PSH market was recently revitalised by the prospect of a remuneration mechanism tailored to long duration energy storage technologies. This mechanism, consulted on in early 2024, is designed to provide long-term revenue visibility to PSH developers though the implementation of a “cap and floor” pricing system.
Cruachan 2 PSH has recently received development approval from the Scottish Government. Developed by Drax, the project aims to expand the existing Cruachan power station by adding a new 600MW underground pumping station. In December 2023, Statkraft announced an agreement with Land Investments Group for the acquisition of the 450MW/2.9GWh Red John PSH scheme in Scotland.
United States of America
The 2022 Bipartisan Infrastructure Law (BIL) includes three incentive offerings specifically for the hydropower sector, for which there were significant developments in 2023. The first incentive is for Maintaining and Enhancing Hydroelectricity Incentives (section 247) supports asset owners who make capital investments to improve grid resilience, improve dam safety, or reduce environmental impacts. Applications were requested in 2023, and DOE anticipates announcing those selected for negotiations in 2024.
The second initiative focuses on Hydroelectric Efficiency Improvement Incentive (section 243), which supports owners or operators of existing facilities who make capital investments that improve their efficiency by at least 3%. In February 2024, DOE Grid Deployment Office announced the selection of 46 hydroelectric projects across 19 states to receive up to US$71.5 million in incentive payments. The owners or operators of hydroelectric facilities receiving the incentives, including PSH, will make capital improvements that improve their facility’s efficiency by an average of 14%.
Lastly, the third incentive, Hydroelectric Production Incentives (section 242) provided to qualified hydroelectric facilities for electricity generated and sold. In October 2023, DOE announced that 66 hydropower facilities throughout the country will receive more than US$36.7 million in incentive payments for electricity generated and sold in 2021 and 2022.
There were also several positive developments in PSH. Duke Energy announced its plans to extend the operating license for the Bad Creek PSH project to almost double the capacity of the site. Upon completion (2033), the Bad Creek II station will have a capacity of approximately 1,640MW, which will make it one of the largest PSH stations in the US. US Army Corps of Engineers reports that Rye Development will construct four new hydropower plants at Corps locking facilities on all three major rivers in the greater Pittsburgh region. The four facilities are expected to generate 250GWh annually. Construction dates have not been announced.
In early 2024, Rye Development announced it had been chosen by DOE to receive US$81 million in funding for the Lewis Ridge PSH project. This selection comes as part of DOE’s Clean Energy Demonstration Program on Current and Former Mine Land, funded under the BIL.
Uruguay
In Uruguay, renewable sources accounted for 91% of electricity generation in 2023, with approximately 45% from hydropower. However, the country faced challenges due to a historic drought in the first half of the year, resulting in the lowest hydropower energy production in the last 20 years.
In July 2023, IDB approved a credit of up to US$800 million to support the modernisation of the Salto Grande, a 1,890MW binational hydropower complex in Argentina and Uruguay. This financing aims to enhance the reliability, availability and environmental sustainability of the complex while extending its operational lifespan.
Uzbekistan
JSC Uzbekhydroenergo tendered for developers for five new hydropower projects with a combined capacity of 46.6MW in August 2023. These projects will be developed as public–private partnerships to promote foreign direct investment in the country. In March 2024, Masdar announced it would investigate the building of the first PSH station in Uzbekistan in an agreement with the country, with the project likely to be 1.6GW and capable of generating 2.8TWh of electricity.
Venezuela
There have been limited hydropower developments in Venezuela due to the country’s ongoing energy crisis. However, there are signs of improvement, as some plants that were not operating at full capacity due to severe droughts are being brought back to life. For example, in February 2024, Venezuelan authorities announced the reactivation of the General José Antonio Páez hydropower complex after four months of intensive repair work.
With two turbines currently operational, the plant is expected to supply 120MW to the electrical grid. Plans are in place to activate two more turbines by the end of April, bringing the complex's total capacity to 240MW. Additionally, during the repair work, over 30,000m3of sediment were removed from the reservoir.
Vietnam
Hydropower sources in Vietnam have the potential to produce up to 40GW of electricity. However, Vietnam is not actively promoting hydropower additions. According to the most recent government energy transition plan, wind, solar and other renewable sources – excluding hydropower – are set to cover nearly 31% of the country's energy needs by 2030, up from about 25% in 2020. Their contribution could rise further to 47%. Hydropower capacity is predicted to grow to 29.35GW by 2030 – which would account for 19.5% of the mix, down from over 30% in 2020 – and to reach 36GW by 2050. Concerns are rising on the impact of changing weather patterns on hydropower availability in Vietnam. As of the end of 2019, major hydropower dams saw record low water levels due to changing weather patterns in the country, raising questions over the generation output for years to come. Vietnam sees an imbalance in its power supply. The northern region mainly relies on hydropower and coal for electricity, both of which have been short of materials. This has led to delays in energy production and distribution.
Zambia
Zambia's Energy Ministry confirmed the cancellation of the Batoka hydropower plant contract, citing concerns over adherence to proper procurement methods and the project's high costs. This decision aims to re-evaluate the project's financial aspects and explore more viable options.
In April 2023, ZESCO commissioned the 750MW Kafue Gorge Lower hydropower plant, a US$2 billion project. Despite initial challenges, ZESCO completed the remaining 600MW, ensuring full utilisation of the plant's capacity.
