The Global Hydropower Sector
Hydropower, the currently most important source of renewable energy worldwide, was first commercialized for the production of electricity in the Niagara Falls in 1879, although human beings had been utilizing more primitive versions of hydropower for centuries. The earliest hydropower usage can be traced back to the ancient Greeks who used simple water wheels in agricultural processes. (National Geographic 2017).
For instance in Finland, the role of hydropower is still today quite remarkable in terms of electricity production. According to Finnish Energy, at its peak in the 1960´s, hydropower accounted for 90% of all electricity generation in the country. Today, hydropower contributes to four per cent (4%) of Finland´s total energy mix, and annually between 10-15% of all electricity production, down from its impressive numbers in the middle of the 20th century. (Finnish Energy 2017).
Despite of being a renewable source of energy, energy authorities and companies admit to the environmental problems caused by dams and hydropower plants. Not only do dams and hydropower plants change natural water systems, but also prevent (fish) species in these water bodies from wandering. The Finnish Association for Nature Conservation, FANC, supports consumers and the industry in improving the sustainability of energy and electricity consumption. It has launched the EKOenergy label, which has now become the international ecolabel for energy. (Fortum 2017; FANC 2017).
In terms of hydropower costs, the International Renewable Energy Agency states that on the average, electricity generated through the use of hydropower is inexpensive, with significant technical potential remaining untapped as of today. One of the obstacles in terms of fully utilizing the potential of hydropower worldwide, according to IRENA, is the absence of data in terms of these technologies. Despite of currently being the most widely used renewable source of energy worldwide with a total market share of 16% in the global energy mix, and more than 80% in the renewable energy mix worldwide, IRENA estimates that the usage of hydropower is far from having reached its full potential on a global scale, although for instance Norway gets more than 99% of its electricity from hydropower. (IRENA 2012).
The World Energy Council (2016) reveals that Asia as a continent has the most significant untapped potential in terms of hydropower, while currently much of the new development is focused in China (26% of the worldwide installed capacity in 2015), Latin America and the African continent. According to the World Energy Council, the average annual growth rate of hydropower worldwide between 2005 and 2015 was almost four per cent (4%). With the share of other renewable energy sources increasing, hydropower now accounts for 71% of all renewable electricity worldwide, a share that has fallen by at least 10% within a few years time only. The countries with the highest hydropower capacity worldwide in 2015 were China, USA, Brazil, Canada, India, and Russia. One major benefit of hydropower is its flexibility and the capacity to store energy even up to several months. (World Energy Council 2016).
In the 2017 Hydropower Status Report the International Hydropower Association insists that hydropower, when correctly and sustainably managed, provides a number of benefits in a world faced with complex problems such as expeditious population growth in addition to energy and water challenges. The IHA identifies following developments and key trends in the worldwide hydropower sector:
- Risk management initiatives established in terms of hydropower
- Co-operative projects within the renewable sector to secure grid stability
- Pump storage serves global requirements for energy storage
- Hydropower interconnected to global markets
- Modernisation of available assets within the hydropower sector
- Advanced reporting mechanisms are now at hand
- Sustainability performance reporting (The Hydropower Sustainability Assessment Protocol) is being implemented worldwide
- Climate resilience acknowledged and emphasized by financing institutions
Furthermore, the IHA recognizes climate change mitigation, including the Paris Agreement and the reduction of GHG´s, being at the center for strategic sustainable development. In terms of environmental protection, both the World Energy Council and the International Hydropower Association acknowledge the availability and deployment of modern technologies that have been designed to minimize the potential harms caused to both water sources and its inhabitants through the hydropower sector. (IHA 2017; World Energy Council 2016).
Learn more by watching U.S. Department of Energy´s video “Energy 101: Hydropower”:
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