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.
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.
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
Latest associated content
Historically, independent power producers (IPPs) have not been major players in the sector in sub-Saharan Africa. But with more supportive policies and innovative financing, that looks set to change.Type:Blog postDate:11 October 2016
Climate change is already having a significant impact on the world as we know it. Rising global temperatures are accelerating glacial melting around the world.Type:Blog postDate:9 September 2016
Eric Martel is the President and Chief Executive Officer of Hydro-Québec, having taken up the role in July 2015.Type:Blog postDate:23 August 2016
23 August 2016
The International Hydropower Association is expanding its knowledge networks initiative to include eight topics identified as the most challenging for the sector.Type:News postDate:23 August 2016
It has long been accepted that every hydropower project is unique, and that bespoke design solutions are required for each project.Type:Blog postDate:10 August 2016