At a glance

In South and Central Asia, hydropower presents significant opportunities for the region's development. With several countries experiencing rapid population growth and increasing energy demands, harnessing untapped hydropower resources can contribute to energy security and economic growth. The optimisation of this potential requires a balance between advancing hydropower generation, preserving environmental integrity, and maintaining geopolitical equilibrium. The Himalayas, serving as Asia's water tower, present a remarkable but fragile opportunity for hydropower expansion, which demands the strengthening of transnational cooperation, particularly among countries such as China, India, Bhutan, and Bangladesh that share the Brahmaputra – the world's largest transboundary river basin. The successful exploitation of hydropower potential in South and Central Asia demands a strategic, environmentally conscious, and collaborative approach, underscoring the importance of international cooperation in this area.

‍

‍

In 2022, the entire region saw nearly 2 GW of new hydropower installed, with many large-scale projects nearing completion and set to be commissioned in 2024-2025. This is due to many governments in the region making commitments and prioritising financial incentivisation policies, as well as creating targets for renewables (including hydropower), across 2022 and early 2023. As well as regional partnerships which have begun to take shape across countries as governments encourage the development of hydropower.

Notably, the Energy Ministers from Kyrgyzstan, Uzbekistan and Kazakhstan signed a roadmap agreement for the construction of the Kambar-Ata-1 hydropower project. The 256 m rockfill dam will have an installed capacity of 1.8 GW when built. The governments of Nepal and India announced an agreement to build the 695 MW Arun IV project, on the Arun River and to improve power transmission to raise the electricity import and export capacity from 600 to 800 MW.

India also finalised its "Guidelines for Pumped Storage Hydropower Projects in Country” in April 2023, which is a landmark document that will incentivise further hydropower development. This region has significant potential to expand its hydropower development which will result in a massive economic boost as well as energy security for local communities.

‍

‍

Latest developments

Azerbaijan  
Azerbaijan inaugurated a cascade of three small hydropower projects that increased the country’s overall installed capacity by 5 MW.  

Bhutan
Bhutan is close to commissioning four projects which would together add an additional 2.9 GW of installed capacity, which would more than double the current installed capacity in the country.

Georgia  
A new scheme has been developed in cooperation between the Government of Georgia and the International Monetary Fund to facilitate the use of renewable energies and attract investment to Georgia. The energy support scheme includes incentives to develop 800 MW of hydropower within the large initiative to promote renewable investment.  

In December 2022, Georgian Prime Minister announced they would be resurrecting the Soviet era Khudoni 702 MW hydropower project, which if built will become the second largest hydropower plant in the country.  

India  
India saw an increase in installed capacity with approximately 434 MW new capacity added over the period, with one of the largest projects being the 180 MW run-of-river Bajoli Holi in Himalchal Pradesh. The

country also saw a tremendous increase in generation due to the high increase in monsoon rains. The 1.5 GW Nathpa Jhakri hydropower station set the highest single day generation record in July 2022.  

Two large-scale PSH projects were announced in India in 2022. The Gandhisagar (or Gandhi Sagar) 1,440 MW pumped storage project will use an existing reservoir and have an energy storage capacity of 10 GWh. In the Maharashtra state, JSW Neo Energy announced that they will develop a 960 MW pumped storage project.

Iran  
Iran saw a year-on-year increase in installed hydropower capacity from 12,193 MW in 2021 to 12,543 in March 2022, an increase of 356 MW.

Israel
The 344 MW Kokhav Hayarden PSH plant, located near the city of Beit She'an and some 120 km from Tel Aviv, is nearing completion. The project is being built by Power Construction Corporation of China and will become the largest pumped storage power plant in Israel. This will more than double the country’s installed pumped storage capacity.  

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.  

Kyrgyzstan
In October, the President of Kyrgyzstan took part in the ceremony celebrating construction commencing at Kulanak hydropower project, and in March 2023 the European Bank for Reconstruction and Development (EBRD) agreed to contribute financially to the project. Additionally, EBRD agreed to finance modernisation of hydropower projects in Kyrgyzstan, with Chakan GES, the state-owned hydropower operator of nine small hydro power plants, to receive a financial package of US$13.8m. The money will help finance the rehabilitation and modernisation of the Lebedinovskaya project, which has an installed capacity of 7.6 MW.

Nepal  
Nepal had an increase of 174 MW of installed hydropower capacity. This is due to the many smaller hydropower projects becoming operational, with the largest being the 28 MW run-of-river Lower Likhu project.

The Nepalese government has endorsed hedging regulation in a bid to attract more foreign investment in the country. This provision that will help minimise the potential financial risk emanating from fluctuating asset price including reservoir or semi-reservoir hydropower projects with at least 100 MW of capacity.  

Pakistan
The Karot 720 MW run-of-river project was commissioned in summer 2022. This project, built by China Three Gorges Corporation (CTG), is the first hydropower project to be completed as part of the China – Pakistan Economic Corridor initiative. Karot will provide stable and affordable energy to Pakistan to meet the electricity demand of roughly 5 million residents, will reduce CO2 emissions by an estimated 3.5 million tons per year and effectively alleviate Pakistan’s power shortage.  

CTG provided scholarships for more than 20 public welfare projects to promote development of surrounding communities. In addition, the project can provide more than 4,500 direct and indirect local jobs each year.

Following a blockage found in a tunnel in July 2022, the Neelum-Jehlum hydropower project became non-operational for safety reasons. The tunnel collapsed in November, but in March 2023 it was reported that the 969 MW project will be operational in July 2023.  

The monsoon period saw substantial increases in generation across the region, however this led to flooding and some projects were heavily impacted. The flooding of the 4,320 MW Dasu hydropower project required a rushed diversion to be constructed to mitigate impacts and to allow further building of the main dam.  

The Pakistan Water and Power Development Authority confirmed its ambition to double its current installed

capacity by adding 10 GW by 2030 through the phased completion of its under-construction projects. Contributing to the increase is the 800 MW Mohmand dam project, with expected completion date in 2026, with recent financial support announced by the Saudi Fund for Development.

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.  

Russia
There has been a great deal of modernisation to increase capacity at existing hydropower projects across the country. The Volzhskaya hydropower project increased by 63 MW, the Irkutsk hydropower project increased by roughly 25 MW and the Votkinskaya hydropower project increased by 15 MW.  Refurbishments increased Russia’s hydropower capacity by nearly 145 MW in 2022.  

The Russian Prime Minister announced that to increase its renewable energy mix, approximately 7,000 MW of new hydropower projects will be constructed. This is in addition to a plan to commission 128 MW of small hydropower projects by 2025

Tajikistan  
In Tajikistan, the Nurek hydropower project’s rehabilitation progressed after operation began of the first unit rehabilitated. The completion of the unit – the first of nine expected to be rehabilitated – was a major milestone. The new turbine extends the economic life of the unit by 35 years and increased the installed capacity by 40 MW to 375 MW. The Nurek HPP, with an installed capacity of over 3,000 megawatts, generates about 50 per cent of total annual energy demand in Tajikistan.

The World Bank approved US$15m in grant financing for the Technical Assistance for Financing Framework for the Rogun hydropower project in late 2022. This

comes six months after the European Investment Bank expressed interest in financing the ‘world’s tallest dam.’ The World Bank grant will include hiring of experts in dam safety and environmental and social frameworks, and the Rogun project will have a benefit-sharing mechanism to ensure that socio-economic programs receive a portion of the revenues.  

Uzbekistan  
It was announced that 250 micro-hydropower projects would be completed in the coming years. The Government anticipates there are 17 projects with a total capacity of 197 MW scheduled to be commissioned in 2023. There are 50 micro-hydropower projects with a capacity of 438 MW set to commence shortly. Construction of the Yavan Hydropower project has begun with a ceremony that was attended by the Presidents of Tajikistan and Uzbekistan for the 140 MW new project.