Sustainable development | The forgotten giant


Hydropower has a crucial role to play in accelerating clean energy transitions to achieve net-zero emissions goals. In a new report, the International Energy Agency calls hydro the ‘forgotten giant’ of low-carbon electricity. It says that a sweeping policy and investment push is required to help countries reach their climate ambitions and support a faster expansion of solar and wind power


Above: The IEA has listed seven key priorities to help governments accelerate the deployment of sustainable hydropower


The growth of hydropower plants worldwide is set to slow significantly this decade, putting at risk the ambitions of countries across the globe to reach net- zero emissions while ensuring reliable and affordable energy supplies for their citizens. According to a new report by the International


Energy Agency, hydropower has a key role in the transition to clean energy not only through the massive quantities of low-carbon electricity it produces but also because of its unmatched capabilities for providing flexibility and storage. “This makes sustainable hydropower an attractive foundation for integrating greater amounts of wind and solar power, whose output can vary, depending on factors like the weather and the time of day or year,” the IEA said in its Hydropower Special Market Report which was published in June 2021.


Slow down In 2020, hydropower supplied one-sixth of global


electricity generation, making it the single largest source of low-carbon power – and more than all other renewables combined. Its output has increased 70% over the past two decades, but its share of global electricity supply has held steady because of the increases in wind, solar PV, natural gas and coal. Nonetheless, hydropower currently meets the majority of electricity demand across 28 different emerging and developing economies, which have a total population of 800 million. Global hydropower capacity is expected to increase by 17% or 230GW between 2021 and 2030 – led by China, India, Turkey and Ethiopia – according to the report which is part of the IEA’s renewables market report series. However, without major policy changes,


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the IEA warns that global hydropower expansion is expected to slow down over this decade. Net capacity additions between 2021-30 are forecast to decrease by 23% compared with the previous decade. The contraction results from slowdowns in development of projects in China, Latin America and Europe. A slow down in the growth of hydropower globally over the next decade “is something the world can ill afford” said Fatih Birol, Executive Director of the IEA. “As our report highlights, hydropower is the forgotten giant of low-carbon electricity; it produces more of it than any other source worldwide. And hydropower’s critical contribution to clean energy transitions is not limited to the huge amounts of renewable electricity it produces – its capabilities for providing flexibility and storage for electricity systems are also unmatched, making it a natural enabler for integrating greater amounts of wind and solar power. “The gap between rhetoric and action remains a major issue today,” Birol continued. “Despite encouraging pledges by more and more governments to reach net-zero emissions by mid-century, climate ambitions are not yet backed up by credible policies to drive down emissions. One concrete step governments can take to start closing this gap is to put hydropower squarely back on the energy and climate policy agenda.”


Policy actions Reversing the expected slowdown will require a range


of strong policy actions from governments to address the major challenges that are hampering faster deployment of hydropower. These include providing long-term visibility on revenues to ensure hydropower projects are economically viable and sufficiently attractive to investors, while still ensuring robust sustainability standards. According to the IEA report, around half of


hydropower’s economically viable potential worldwide is untapped, and this potential is particularly high in emerging economies and developing economies, where it reaches almost 60%. Based on today’s policy settings, China is set to


remain the single largest hydropower market through 2030, accounting for 40% of global expansion, followed by India. However, China’s share of global hydropower additions has been declining due to the decreasing availability of economically attractive sites and growing concerns over social and environmental impacts. Between now and 2030, US$127 billion – or almost one-quarter of global hydropower investment – is set to be spent on modernising ageing plants, mostly in advanced economies. This is notably the case in North America, where the average age of a hydropower plant is nearly 50 years, and in Europe, where it is 45 years.


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