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Hydropower in South America

In several countries in South America, hydropower provides more than half of total electricity supply and it is expected to remain the region’s largest renewable source for years to come.
Generation by hydropower (2024)
725TWh
Hydropower installed capacity (2024)
183 GW
Capacity added (2024)
306 MW
Pumped storage installed capacity (2024)
994 MW
Pumped storage capacity added (2024)
0 MW

South America regional overview and outlook

Hydropower is vital for South America’s energy mix, and thanks to natural resources such as the Andes mountains and the Amazon basin, potential for generation is vast. A mere 30% of the region’s hydropower potential is currently being exploited, but even that satisfies approximately 45% of the continent’s electricity demand.

The industry is rising to the challenge as sustainability becomes increasingly important in such an ecologically-sensitive environment. In January 2025, for example, Brazil’s Mascarenhas hydropower plant received gold certification under the Hydropower Sustainability Standard. The 198MW run-of-river plant owned by ENRG became only the second project in South America to achieve gold status, a fitting way to celebrate 50 years in service. Meanwhile, Colombia’s 19.9MW Chorreritas project earned Hydropower Sustainability Standard silver certification, making it only the 10th project in the world to achieve silver or higher. Likewise, the 2,400MW Ituango Hydroelectric Project in Colombia – South America’s largest ongoing hydropower scheme – has only recently begun phased commissioning amid significant technical and social challenges, yet its full capacity will be critical for the country’s energy security once all turbines are online.

By 2024, solar and wind power accounted for 36.8GW of installed capacity in the continent’s grid, out of a total capacity of around 400GW. Renewables may be increasing, but so is potential grid instability as operators attempt to match inconsistent renewable generation with demand.

In response, South America is pioneering hybrid systems combining hydropower and other renewables to maximise sustainability and efficiency. The deployment of PV arrays on hydro reservoir surfaces is a leading example of this approach.

Brazil, for example, began construction of the country’s largest floating solar plant in late 2024. The 54MW facility at the Lajeado hydro reservoir in Tocantins features thousands of solar panels on the dam’s reservoir, leveraging existing transmission while the cooling effect of the water will boost solar output.

Conversely, prospects for rising energy demand are materialising through billion-dollar investments across the region in data centres, extensive mining operations, mega-port logistics hubs and heavy industry. Moreover, the 2024 inauguration of Peru’s Chancay Port – now South America’s largest – has quickly become one of the most energy-intensive and industry-stimulating developments in recent years. Global tech companies are considering Colombia for new regional data centres, and Equinix is leading plans to develop an integrated financial data centre spanning Chile, Colombia and Peru. These trends underscore the urgent need for both reliable baseload generation and flexible, sustainable capacity.

Hydropower remains the backbone of South America’s energy system, and as the region embraces innovation and sustainability – through certified projects and hybrid systems such as floating solar – its vast Andean-Amazon potential continues to shape a resilient, renewable future.

Cachoeira Caldeirão hydropower project, Brazil. Credit: Engie

South America policy and market overview

Although several high-profile projects are reaching completion, the overall rate of hydropower development in South America has plateaued. Regulatory reforms in the sector are often lagging the needs of the industry. Uncertainty around concession renewals, particularly in Brazil, has created challenges for operators, worsened by political volatility and frequent policy shifts in countries such as Argentina and Colombia. This instability has led to investor/state disputes and project delays.

In 2024-2025, Colombia’s government clashed with hydropower companies over alleged opaque pricing and excessive profits, contributing to a 25% drop in investment confidence. In response, authorities are pushing for stricter oversight and tariff reforms.

Sustainable hydropower in South America faces persistent barriers – chiefly slow, multi-layered approval processes and fragmented water-rights regimes. In Argentina, dual federal-and-provincial concessions and lengthy disputes prompted a 2024 provincial water law and audits to ease delays. In Peru, bureaucratic inertia and local opposition have repeatedly slowed hydropower developments. In Chile, the 2022 Water Code reform replaced perpetual water rights with 30-year conditional concessions – curbing speculation in the secondary market by making unused entitlements forfeitable.

Similarly, social and environmental review processes can extend timelines. Colombia, where hydropower still provides about 65% of electricity, has begun issuing decrees to streamline bureaucratic steps and strengthen social consent for new dams.

Meanwhile, Chinese investors are recalibrating their approach. Under China’s Going Out strategy and Belt & Road Initiative, investment initially focused in some markets on constructing large dams. Today, there is greater emphasis on acquiring operational assets such as hydropower plants and transmission companies to secure stable returns and avoid political risk. Firms such as State Grid Corporation of China have expanded into Chilean, Brazilian and Peruvian grids. However, fluctuations in Chinese capital flows, driven by domestic challenges, could impact future funding.

Despite efforts, hydropower faces competition from quicker, lower-risk solar and wind projects. Large projects such as Brazil’s São Luiz do Tapajós dam have stalled due to financing and environmental hurdles or specific issues around indigenous rights.

Climate change poses major risks. Severe droughts intensified by El Niño in 2024 and 2025 critically impaired hydropower generation, leading to power cuts and higher electricity costs. Governments are now urgently seeking to diversify energy sources and improve water management.

Santo Antônio do Jari hydropower project, Brazil. Credit: Engie

Latest developments

Argentina
Bolivia
Brazil
Chile
Colombia
Ecuador
Guyana
Paraguay
Peru
Uruguay
Venezuela

Argentina

Hydropower installed capacity (2024)
11,137
MW
Pumped storage installed capacity (2024)
974
MW
Generation by hydropower (2024)
33
TWh

The Argentinian hydropower sector is undergoing major growth, with several large-scale projects nearing completion and new developments planned. Projects include the 1,310MW Santa Cruz hydroelectric plant, which is slated for completion by 2026. The 950MW Condor Cliff Dam, developed by Represas Patagonia, is set for commissioning by 2027, while the 871MW Chihuido project, still in permitting, is expected online by 2029. The national government also announced plans for the ambitious 3,500MW Cospues plant, aiming for 2033 operations. Meanwhile, the Río Grande PSH, the continent’s largest reversible facility, is operating at 50% capacity, with ongoing renovations due for completion in late 2025.

Argentina’s national hydroelectric capacity was revised down by 746MW in 2024, following a reclassification of the Yacyretá plant to reflect only the Argentine share. Across the country, hydropower generation declined 15.02% compared to 2023, with a further 34.3% drop in January 2025 due to extremely low river inflows. At the same time, large mining endeavours – such as copper and lithium extraction at the Caucharí-Olaroz plant in Jujuy – together with emerging green hydrogen production and the reactivation of petrochemical complexes, will each demand tens or even hundreds of megawatts, have further strained the national energy supply.

Countries to watch

Key

Low unexploited potential/minimal policy activity/limited project pipeline
Moderate unexploited potential/some policy activity/intermediate project pipeline
High unexploited potential/strong policy activity/Large project pipeline
Country
Unexploited potential
Policy activity
Development pipeline
Canada

Canada

Unexploited potential

Canada has a well-established hydropower fleet, but significant potential remains.

Policy activity

Its federal government and several provinces are promoting new hydropower development.

Development pipeline

Several projects are underway to increase capacity at existing plants and build new ones.

United States

United States

Unexploited potential

Approximately 80 PSH sites have been identified, most of which are closed loop.

Policy activity

The US Federal Energy Regulatory Commission (FERC) has introduced expedited licensing processes for closed-loop PSH projects, reducing permitting times from several years to months.

Development pipeline

67 new projects are in various stages of planning across 21 states, representing more than 50GW of new storage capacity. Three projects are fully permitted and awaiting final investment decisions.

Costa Rica

Costa Rica

Unexploited potential

Costa Rica has a well-established hydropower fleet, but potential remains.

Policy activity

New hydropower development is underway. The Renewable Energy Laws and Regulations Report 2025 highlights updated incentives for private renewable energy projects, streamlined permitting processes for small hydropower and storage, and favourable feed-in tariffs for run-of-river plants. 

Development pipeline

One new project announced.

Dominican Republic

Dominican Republic

Unexploited potential

The Dominican Republic has identified new greenfield and brownfield PSH sites. 

Policy activity

The country’s state-owned hydroelectric utility has called for tenders to better define the potential of PSH.

Development pipeline

The development pipeline is unclear.

Ecuador 

Ecuador 

Unexploited potential

Ecuador has tapped only 7% of its hydro power potential.

Policy activity

Government initiatives have been designed to help Ecuador meet its long-term goal of sourcing 80% of its electricity from renewable sources. Further policy efforts are under way to encourage greater private sector participation.

Development pipeline

Key projects include two new run-of-river plants, which will add approximately 150MW, and the ambitious Zamora G8 project (3,600MW), now in final feasibility. The Toachi-Pilatón complex (254MW) is also nearing completion.

Argentina 

Argentina 

Unexploited potential

Argentina has harnessed only 20% of its hydropower potential. The Inter-American Development Bank has identified 23 potential PSH projects with average installed capacities of 414.5MW.

Policy activity

Recent policy initiatives have focused on modernising ageing assets rather than launching new mega-dams. Argentina recently began recognising pumped hydro in the wholesale market, with plants remunerated for both energy generated, and energy consumed for pumping.

Development pipeline

Contract renewals have stalled the Néstor Kirchner and Jorge Cepernic dams (1,310MW). The Aña Cuá Expansion (270MW) has halted due to funding and binational tensions. Chihuido I (637MW) awaits financial closure. In PSH, Argentina’s focus has been on fully reactivating Río Grande’s capacity, with the 750MW facility operating at 50% capacity.

Chile

Chile

Unexploited potential

The country has significant potential for small and micro run-of-river projects and pumped storage. Chile has realised approximately 53% of its estimated 16GW hydropower potential. The IADB has identified 16 potential sites for PSH development.

Policy activity

Permitting has been streamlined for energy storage and integrated hybrid projects. Chile’s government announced a circa US$2 billion investment in energy storage by 2026. Energy storage assets can now earn revenue from capacity and ancillary services in Chile, improving the bankability of PSH.

Development pipeline

Four hydropower projects are under construction totalling 194.5MW, with a combined investment of $677 million. The Los Lagos Run-of-River project (52MW) has also received approval. Chile’s two biggest PSH projects – Paposo (800MW) and Espejo de Tarapacá (300MW) – have both stalled. Paposo due to environmental concerns and Espejo de Tarapacá due to funding.

Peru

Peru

Unexploited potential

Peru has harnessed 8% of its hydropower potential of 69.45GW.

Policy activity

Recent policy initiatives seek to accelerate concessions, shorten environmental review timelines, and accelerate consent processes. An additional initiative seeks to simplify access to competitive financing and shorten perfectibility and construction-licensing periods for small hydro projects.

Development pipeline

The Ministry of Mines and Energy has confirmed that six projects totalling 664MW will enter commercial operation between 2025 and 2027. These include the San Gabán III, Santa Lorenza and Anashironi hydroelectric plants, as well as the Centauro I and Centauro III facilities.

Brazil

Brazil

Unexploited potential

The IADB has identified 28 sites for potential PSH development with an average installed capacity of 387MWh. EPE's research on pumped storage in Brazil, which incorporates social and environmental factors, has identified 15 possible locations for PSH development.

Policy activity

Policy objectives are set by ANEEL, clarifying questions about adaptation to grid access, licensing regulation and remuneration. Brazil’s Mines and Energy Ministry highlighted pumped storage “reversible” plants in its 2050 energy policy plan as a preferred alternative to new mega-dams. PS is currently unable to access auctions for storage.

Development pipeline

While the signs look promising, there are no notable projects in the development pipeline yet.

Türkiye 

Türkiye 

Unexploited potential

Opportunities remain in Türkiye to develop new conventional hydropower projects and expand existing facilities

Policy activity

The government has made hydropower a central pillar of its energy policy during the past two decades, providing substantial support for the development of new facilities.

Development pipeline

A robust pipeline of conventional hydropower projects is progressing in the country, with nearly 600MW currently under construction.

Switzerland 

Switzerland 

Unexploited potential

While potential for new hydropower construction is limited in Switzerland, opportunities remain to expand storage capacity across the existing reservoir fleet.

Policy activity

A law introduced in 2023 streamlines approval processes for hydropower projects, supporting the national goal to add 2TWh of storage capacity by expanding existing infrastructure.

Development pipeline

Owners of existing facilities are obliged to assess which of their assets should be upgraded before developing plans for modernisation.

Austria

Austria

Unexploited potential

There is substantial potential to expand Austria’s existing PSH fleet.

Policy activity

The country’s National Energy and Climate Plan emphasises renewable expansion and storage integration, identifying PSH as central to achieving long-term energy goals.

Development pipeline

Austria has a strong pipeline of pumped storage projects, with approximately 1.3GW under construction and more than 2.8GW in early development stages.

United Kingdom 

United Kingdom 

Unexploited potential

Scotland and Wales have significant potential for expansion of the PSH fleet, with numerous projects recently announced.

Policy activity

The introduction of the Cap & Floor scheme, designed to support long-duration electricity storage, is helping to revitalise the PSH market by providing clearer investment signals and indicating strong political commitment.

Development pipeline

More than 13GW of pumped storage projects have been announced in the UK and are currently at various stages of development.

Spain

Spain

Unexploited potential

There is significant potential to expand Spain’s pumped storage fleet, particularly through brownfield developments connecting existing reservoirs.

Policy activity

Spain’s updated National Energy and Climate Plan has set an ambitious energy storage target of 22.5GW by 2030, up from 20GW, with pumped storage hydropower included among the key technologies.

Development pipeline

Approximately 7GW of PSH projects have been identified in Spain, although only 300MW are currently under construction.

Italy

Italy

Unexploited potential

There is noticeable potential to expand Italy’s PSH fleet, particularly through brownfield developments linking existing reservoirs.

Policy activity

Italy has introduced a new capacity mechanism (MACSE) to support the development of large-scale electricity storage solutions. National transmission operator Terna has been tasked with proposing changes to the rules governing pumped storage plant participation in the scheme.

Development pipeline

The country has a PSH pipeline with a combined potential installed capacity of nearly 4GW.

Greece

Greece 

Unexploited potential

Greece has significant potential to develop pumped storage through greenfield and brownfield projects, as well as by converting existing non-hydro infrastructure.

Policy activity

The country’s National Energy and Climate Plan sets a target of 3GW of energy storage capacity by 2030.

Development pipeline

Greece has more than 3GW of pumped storage projects in development, with approximately one third of this pipeline already under construction.

Nigeria 

Nigeria

Unexploited potential

Nigeria has considerable hydropower potential of over 14GW, especially in central and northern regions. Only about 15% of this capacity has been utilised.

Policy activity

Nigeria has launched the Sustainable Power and Irrigation Project, aiming to unlock 10,000MW of hydropower capacity by utilising existing dams and developing new projects.

Development pipeline

Nigeria has a handful of mid-to-large projects under construction, like Mambilla (3,050MW), and many in approval stages.

Democratic Republic of the Congo

Democratic Republic of the Congo

Unexploited potential

The DRC holds undeveloped hydropower reserves, notably along the Congo River. It potential of around 100GW (almost 13% of the world’s total), but less than 3% of this capacity is exploited.

Policy activity

The DRC government is taking steps to exploit more of its hydro potential, through international partnerships and regional initiatives. It aims to reform its power sector to attract further investment.

Development pipeline

Some smaller projects are in construction, but Inga III (4,800MW) is at the regulatory stage and the mega-project Grand Inga (44,000MW) is awaiting regulator approval and financing.

Mozambique

Mozambique

Unexploited potential

Mozambique has hydropower resources, particularly in the Zambezi River basin. The country’s technically feasible hydropower potential is more than 12,000MW, of which only around 20% has been exploited.

Policy activity

The government is actively pursuing large hydro expansions through public-private and regional initiatives. Policy measures, like a feed-in tariff to encourage small hydro investments, and efforts to attract foreign partners are in place to integrate new hydropower, both for domestic use and export.

Development pipeline

Mphanda Nkuwa (1,500MW) is under construction, supported by several regulator-approved mid-sized projects.

Ethiopia

Ethiopia

Unexploited potential

Ethiopia boasts economically feasible hydropower potential of approximately 45GW. The country aims to harness a significant portion of this capacity to become a major power exporter in the region.

Policy activity

Hydropower is the backbone of Ethiopia’s energy strategy with plans to become a regional electricity export hub by 2030. The government has proactively built dams for domestic supply and exports, achieving around 4.3GW hydro installed and 6.6GW under construction. It is opening the sector to independent power producers.

Development pipeline

The country has a broad and active pipeline including multiple large projects under construction, such as Koysha (1,800MW) and the Grand Ethiopian Renaissance Dam (5,150MW).

Cameroon

Cameroon

Unexploited potential

Cameroon’s economically exploitable hydropower potential is estimated around 12,600MW, with major potential in the Sanaga and Lom rivers. Only about 4% of this potential has been developed.

Policy activity

Cameroon has developed a National Water Policy and hydropower expansion is integral to its long-term development vision, Emergence 2035. The strategy is to use hydropower for energy access and become a regional power exporter, while ensuring new projects align with environmental and social standards.

Development pipeline

Multiple large-scale projects are under construction, like Nachtigal Falls (420MW) and Grand Eweng (1,800MW), with several more regulator approved.

Morocco

Morocco

Unexploited potential

Morocco already utilises PS but is expanding further. The Office National de l’Electricité et de l’Eau Potable (ONEE) has mapped out around 1,606 potential PSH sites, with over 36% deemed highly suitable.

Policy activity

The country has integrated PS into its renewable energy strategy, aiming for 52% of electricity generation from renewables by 2030. ONEE is advancing PSH projects to support its renewable energy targets.

Development pipeline

Morocco has a robust pipeline with three PSH projects totalling nearly 1,000MW, including the operational Abdelmoumen project (350MW), and two projects under construction: Ifahsa (300MW) and El Menzel (300MW).

South Africa

South Africa

Unexploited potential

The Department of Water and Sanitation has identified seven sites for potential PS schemes, aligned with coal phase-out zones.

Policy activity

South Africa supports expansion of PSH to enhance grid stability and integrate renewable energy. Eskom, the national utility company, operates existing PSH schemes and is developing other projects, a priority under the Infrastructure South Africa Programme.

Development pipeline

The 1,500MW Tubatse project has been announced with international interest.

Kyrgzystan 

Kyrgzystan 

Unexploited potential

The country’s hydropower potential is estimated at 140TWh per year, of which approximately 10% has been exploited.

Policy activity

Kyrgyzstan has been actively supporting intergovernmental agreements and regional electricity sharing initiatives related to the 1,860MW Kambarata-1 hydropower project.

Development pipeline

Four projects are currently under construction, with several others announced, including the Suusamyr–Kokomeren cascade, which is expected to add 1,305MW of capacity.

Pakistan

Pakistan

Unexploited potential

The country has 60GW of hydropower potential of which approximately 18% has been exploited.

Policy activity

Pakistan launched its ‘Decade of Dams’ initiative in 2021, aiming to expand installed hydropower capacity from approximately 9GW to 20GW by 2030.

Development pipeline

The 4,320MW Dasu and 800MW Mohmand dams are under construction. The Tarbela 5th Extension will increase the project’s installed capacity from 4,888MW to 6,418MW.

Tajikistan 

Tajikistan 

Unexploited potential

Tajikistan has the potential to generate 527TWh of electricity annually from hydropower, but only around 4% of this capacity has been developed to date.

Policy activity

Tajikistan has announced plans to achieve 100% renewable electricity by 2032, with hydropower playing a central role.

Development pipeline

The country is seeking to become a regional electricity powerhouse through the 3,600MW Rogun project and the CASA-1000 transmission network.

Bhutan 

Bhutan 

Unexploited potential

Bhutan has an estimated 35GW of hydropower potential, of which approximately 9% has been developed. In July 2024, the first two turbine generators of the 1,020MW Punatsangchhu II project became operational.

Policy activity

In August 2024, Bhutan’s Electricity Regulatory Authority released its Strategic Plan 2024-2029, aimed at strengthening regulatory frameworks and promoting innovation across the power sector. The country has also signed agreements with several regional governments to support its growing hydropower pipeline.

Development pipeline

The 1,200MW Punatsangchhu-I is nearing completion as well as several other projects under construction. The 2,584MW Sankosh project has been announced.

India 

India 

Unexploited potential

With an estimated technical potential of up to 181.5GW across both on-river and off-river sites, PSH is recognised in India as a mature, proven solution for large-scale energy storage, grid stability and peak demand management.

Policy activity

The Indian government has developed national and state-level policies to support pumped storage hydropower (PSH), including the PSP Guidelines and the Hydropower Policy 2025. Policy momentum remains strong, with new measures such as the Energy Storage Obligation, waivers on interstate transmission charges and proposed viability gap funding to incentivise PSH deployment.

Development pipeline

Several projects are nearing completion that will nearly double India’s installed capacity from 4.7GW to 8GW.

Iran

Iran

Unexploited potential

Iran operates the 1,040MW Siah Bisheh pumped storage plant and is progressing with development of the Azad pumped storage project.

Policy activity

Iran’s Minister of Energy, Dr Abbas Aliabadi, has called for the accelerated implementation of pumped storage projects, although limited policy progress has been made to date.

Development pipeline

Iran’s 510MW Azad pumped storage project is planned for completion in 2027.

Laos 

Laos 

Unexploited potential

Laos holds a vast reserve of undeveloped hydropower capacity, enabling a policy to become a key regional electricity exporter and the "Battery of Southeast Asia".

Policy activity

This country has implemented policies like the Sustainable Hydropower Development Policy and Renewable Energy Strategy with the aim of becoming a key regional energy supplier, targeting electricity exports of up to 14,800MW by 2025.

Development pipeline

It is actively expanding its hydropower sector, with more than 4,000MW of new projects currently under construction. Key projects include the 1,400MW Luang Prabang Dam, the 728MW Phou Ngoy Dam, and the 1,060MW Pak Beng Dam, all located on the Mekong River.

China 

China 

Unexploited potential

China continues to expand its conventional hydropower capacity and is aggressively expanding its pumped storage hydropower capacity.

Policy activity

China’s latest energy policy strategies set out plans for expansion. The 13th Five-Year Plan for the electricity sector outlines plans to add 60GW of new conventional hydropower capacity.

Development pipeline

The country has a significant pipeline of projects underway, with large-scale conventional projects in major river basins such as the Jinsha, Dadu, and Yalong Rivers. There are more than 200 PSH projects in the pipeline backed by substantial funding, streamlined permitting, and supportive market reforms to accelerate implementation.

Indonesia

Indonesia 

Unexploited potential

Indonesia has completed a comprehensive survey of potential sites and identified the most favourable locations.

Policy activity

This country is committed to the expansion of hydropower capacity. The updated Electricity Supply Business Plan (RUPTL) for 2025–2034 targets a 35% renewable energy share by 2034, with 16GW of new hydropower capacity.

Development pipeline

There are notable projects in the development pipeline. In 2025 alone, the Upper Cisokan Pumped Storage Plant (1,040 MW) and conventional projects at Jatigede (110 MW), Asahan 3 (174 MW), Peusangan 1 and 2 (88 MW) and Merangin (350 MW) are due online.

Malaysia 

Malaysia 

Unexploited potential

Malaysia still holds significant potential. While large projects continue, Malaysia is shifting toward small hydropower (SHP) and hybrid hydro-solar initiatives.

Policy activity

Malaysia’s National Energy Policy (2022–2040) designates hydroelectric power as a key technology for renewable energy development. The government aims to achieve 31% renewable energy capacity by 2025 and 40% by 2035, with hydropower playing a significant role in meeting these targets.

Development pipeline

Malaysia has a number of projects at various stages of the development pipeline. These include major projects like the 1,285MW Baleh plant in Sarawak, expected by 2029/30, and the 300MW Nenggiri plant in Kelantan, slated for 2027.

Vietnam

Vietnam

Unexploited potential

Vietnam has considerable untapped hydro resources due to its abundant river systems and mountainous terrain.

Policy activity

Vietnam’s Power Development Plan VIII, initially approved in May 2023, underscores strong government support for hydropower, prioritising both traditional and pumped storage projects to enhance energy security and promote clean, sustainable growth.

Development pipeline

Vietnam is actively developing its pumped storage hydropower capacity, with the 1,200MW Bac Ai Pumped Storage Plant currently under construction. Several other pumped storage projects are in the feasibility study phase.

Australia

Australia

Unexploited potential

Australia has identified significant PSH potential across multiple states, especially in areas transitioning from coal.

Policy activity

The country is making proactive moves toward PSH and long-duration energy storage (LDES), supported by strong government backing, although it does not recognise LDES or PSH in its net zero policy wording.

Development pipeline

It has a significant volume of PSH projects at various stages of the development pipeline, from detailed planning (Oven Mountain, Phoenix, Lake Lyell, Borumba) through procurement (Capricornia), to active construction (Snowy 2.0, Muswellbrook).

Philippines

Philippines

Unexploited potential

The Philippines has considerable hydro and PSH potential, with strong demand for grid stabilisation.

Policy activity

The country has proactively moved on its PSH expansion strategy, with an oversubscribed auction. The Philippine Department of Energy set a 4,250MW target for PSH in the 2025 Green Energy Auction, which drew bids of 7GW.

Development pipeline

A number of pumped storage projects are currently in the early stages of development. A total of 11 major energy projects (~4,500MW) received DOE endorsement for grid impact studies in February 2025, with PSH projects constituting the bulk of this capacity.

Case Study

Hidroituango also referred to as Ituango, is a hydropower plant located in Antioquia, Colombia, which will provide 17 per cent of the country’s electricity demand when completed in 2024. Ituango is a project of the Ituango Hydrolectric Company, made up of the majority partners Instituto para el Desarollo de Antioquia, the Government of Antioquia and Empresas Públicas de Medellín who is the main contractor and operator.

The project’s completion had been delayed due to severe weather conditions. Between April and May in 2018, Antioquia experienced heavy rains which caused large landslides. These events coupled with geological characteristics, resulted in the premature filling of the reservoir. A sudden unblocking of one of the diversion tunnels caused flooding downstream of the dam and an evacuation of the surrounding communities.  

A year later, Colombia’s National Disaster Risk Management Unit declared that the 600 families that were evacuated could safely return to their homes.  In 2021, a report warned that the decision to abort the project would pose a greater socio-environmental threat than finishing it. The Colombian licensing authority ANLA provided a series of recommendations for the safe completion of the dam and powerhouse. These recommendations were implemented and since late 2022, Ituango has been supplying continuous electricity from 600 MW capacity to the national grid.  

The project is undergoing an assessment under the Hydropower Sustainability Standard to certify its compliance and demonstrate its alignment with performance standards. This assessment is undergoing public consultation with an expected completion in June 2023.  

Once Ituango is fully completed in 2024, it will have a total installed capacity of 2,400 MW and will represent a reduction in emissions of 4.4 million tons of CO2 per year.

Interesting Fact  

Pumped storage remains largely untapped in Latin America, but a 2024 IADB report highlights its potential to boost renewable integration as ageing hydro plants modernise. The two-stage study identifies 179 possible sites across 11 countries and lays out plans for a pilot project in Pisagua, Tarapacá, Chile, providing 640MW with 12 hours of storage. The pilot uses two 4.5Mm³ reservoirs, four 160MW Francis turbines, and two 220kV lines. The US$570 million project would be constructed over 48 months at a cost of US$32/MWh and a 12.8% IRR. A proposed 1,200MW solar PV plant would add 300MW of capacity.

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