Markets and finance
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 Markets and Finance Knowledge Network. The network focuses on building and sharing knowledge on key trends and developments in hydropower financing.
IHA members can access the knowledge network in Hydropower Pro, our online member community.
In the online group, network members can connect with each other, exchange experiences and access essential resources, briefings and case studies.
Latest associated content
Junaid Ahmad is the senior director of the World Bank’s Global Water Practice. In this video interview, he spoke with us about the investment case for hydropower and the world in 2050.Type:Blog postDate:7 November 2014
Hydropower developer NuPlanet has begun construction of the 4.5 MW Stortemelk station near Clarence in the Free State Province, South Africa, after agreeing financing on the project.Type:News postDate:7 November 2014
Maria Van Der Hoeven is the executive director of the International Energy Agency.Type:Blog postDate:16 October 2014
On Thursday 4 September at World Water Week 2014 in Stockholm, we collaborated with the International Institute for Environment and Development (IIED) and the International Union for Conservation of Nature (IUCN) to convene a seType:Blog postDate:12 September 2014
A conglomerate operating in 23 countries through its 15 businesses, three investment funds and five supporting companies, Odebrecht Organisation employs nearly 200,000 people today and is one of the important actors in the hydroType:Blog postDate:27 August 2014