4 September 2012 – Support from governments around the world is making hydropower a key renewable energy source, and small hydropower (SHP) plants in particular are exhibiting impressive growth thanks to numerous advantages over larger plants, according to energy market analyst GlobalData.

According to a recent report by that group, global installed hydropower capacity increased from 896.9 Gigawatts (GW) in 2006 to 1,072.1 GW in 2011, and is expected to climb to 1,443 GW by 2020 thanks to support from governments around the world.Renewable energy is becoming increasingly popular as conventional sources become more expensive due to decreasing reserves, and countries aim to minimise their carbon footprint. GlobalData’s research suggests that thanks to its reliable and affordable nature, SHP has emerged as one of the most favoured and promising solutions.

Small and mini hydro facilities are gaining importance as their effect on the environment, and national budgets, is less substantial. The construction of SHP plants does not disturb the local habitat and the building of large dams and reservoirs is unnecessary, thereby avoiding issues of deforestation and submergence. SHP plants are consequently much quicker to construct and also offer higher rates of return due to the low capital investment and operational and maintenance costs. Their implementation also carries positive social benefits as they encourage community participation and capitalise on local skills for plant construction.

China is the biggest SHP market globally, accounting for 55.3% of the cumulative installed capacity in 2011. China has installed 59 GW of small hydro and is expected to take the lead among small hydro countries. China is followed by India and the US, with 9% and 6.9% of the SHP installations, respectively.

GlobalData predicts cumulative installed capacity of SHP to grow from a 2011 figure of 106.7 GW to 137.8 GW by 2020, climbing at a compound annual growth rate (CAGR) of 2.9%.