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Finance and preparation

To meet global climate and sustainability goals, a major effort is needed to mobilise public and private sector investment in renewable technologies such as hydropower.

While a mature technology, securing favourable financing arrangements for hydropower development can be a challenging task, which needs to be specifically tailored for each project.

Developers are often faced with high upfront costs, rigorous and complex project preparation, environmental and social considerations, and services which are not adequately remunerated.

Our action

IHA is working across several fronts together with developers, investors, international financial institutions and NGOs to help mitigate the economic risks of hydropower development and unlock greater investment.

Through the promotion of the Hydropower Sustainability Tools and as part of the Climate Bond Initiative’s technical working group, we have contributed to the development of proposed hydropower eligibility criteria for climate financing for the growing green bond market.

We are also collaborating with international partners on the role of project preparation facilities and the policy and market changes needed to fully reflect hydropower’s contribution to evolving electricity systems.

In 2019, a new IHA study on project ownership study offered insights on the level of private sector involvement in hydropower. The study also analysed how a project’s size impacts its ownership model and the role of foreign direct investment.

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Latest associated content

  • 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
  • 2017 congress focus session

    GHG reporting

    Mitigating climate change is one of the most important goals for strategic sustainable development. There is a clear and pressing need to quantify the greenhouse gas footprint of all human activities.

    Type:
    Programme item
    Date:
    13 October 2016
  • Photo of Katai Kachasa speaking at the World Hydropower Congress

    CEO interview: pioneering IPP projects in Zambia

    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 post
    Date:
    11 October 2016
  • Richard Taylor

    The role of multipurpose hydropower in a water-stressed world: World Energy Congress 2016

    The 23rd World Energy Congress on 9–13 October in Istanbul, Turkey, will feature a discussion on hydropower’s role in a water-stressed world.

    Type:
    Blog post
    Date:
    14 September 2016

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