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Finance and investment

Despite the strong demand for clean energy and an abundance of capital available worldwide, securing favourable financing arrangements for hydropower development is a challenging and complex task, which needs to be specifically tailored for each project.

The reasons for this are multidimensional as financing is contingent on a variety of factors, such as hydrology, and environmental and social considerations, which impacts a project’s risk-reward profile.

Preparation facility model

A significant barrier to private sector investment in hydropower is the financial risk associated with rigorous and complex planning and assessments, with no certainty for investors that a project will be given permission to proceed.

We are promoting a new hydropower project preparation facility model, which could help investors, developers and governments get new projects off the ground, by ensuring that each one is selected according to recognised sustainability criteria and national and regional development needs. Read more.

Green bonds

An innovative new investment instrument, green bonds are fixed income loans for the finance and refinance of projects and assets that help address environmental and climate risks. 

We are working with partners to agree recognised eligibility criteria for green bonds to fund hydropower projects. Read more.


 

Join the network

Members interested in contributing to the development of the Hydropower Preparation Facility concept or learning more about green bonds should join IHA’s Finance and Investment Knowledge Network. The network focuses on building and sharing knowledge on key trends and developments in hydropower financing.

Network resources

Members can gain access to resources, case studies and webinars including:

  • Briefing note: Hydropower and the development of the green bond market
  • Slides from the ‘Innovation in hydropower financing’ workshop held in February 2018
  • Slides and statistics on the latest trends and developments in hydropower financing

Contact us

For any questions, please contact IHA senior analyst Nick Troja at nicholas.troja@hydropower.org

Latest associated content

  • 2017 congress focus session

    Capacity-building and skills shortages

    Hydropower development and operations requires a variety of expertise.

    Type:
    Programme item
    Date:
    13 October 2016
  • 2017 congress focus session

    Climate resilience

    Many countries are seeking a better understanding of climate change impacts – both positive and negative – and are beginning to build strategies and approaches to climate resilience into their plans for the development of new hydropower facilities

    Type:
    Programme item
    Date:
    13 October 2016
  • 2017 congress plenary session

    Hydropower Preparation Support Facility: Plenary

    Properly planned hydropower projects can provide grid stability, energy storage and flexibility for balancing more variable renewable energy sources.

    Type:
    Programme item
    Date:
    13 October 2016
  • 2017 congress focus session

    Climate bonds for hydropower

    Climate bonds and green bonds are examples of the emerging instruments for green finance and investment in the energy sector that could be used for hydropower.  They are fixed income loans created to specifically finance and refinance projects and

    Type:
    Programme item
    Date:
    13 October 2016
  • 2017 congress focus session

    Benefits of hydropower

    Single and multipurpose hydropower facilities can make substantial contributions at local, regional and national levels.

    Type:
    Programme item
    Date:
    13 October 2016

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