Hydropower generation utilizes the energy of falling or flowing water to spin turbines and generate electricity. It is one of the leading renewable and clean sources of energy that produces no greenhouse gas emissions during operation. Hydropower plants can range from small installations for local use to large hydropower dams that can power entire regions. The technology offers reliable baseload electricity and flexible load-following operations to balance intermittent renewable power sources like solar and wind power. The Global Hydropower Generation Market is estimated to be valued at US$ 290.3 Mn in 2024 and is expected to exhibit a CAGR of 7.7% over the forecast period 2024 to 2030.

Key Takeaways

Key players operating in the Hydropower Generation market are Adeka Corporation, BASF SE, Chitec Technology Co. Ltd, Clariant, Evonik Industries AG, PMC Group, Polyvel Inc., SABO SpA, SK Capital Partners, Solvay, and Songwon. Hydropower is becoming an increasingly important source of renewable energy globally as concerns over climate change drive the adoption of low-carbon power sources. Several countries worldwide are expanding their hydropower capacity to meet rising electricity demand and decarbonization targets. For example, China is investing heavily in large dams across Asia and Africa as part of its Belt and Road Initiative to boost sustainable infrastructure development.

Market Drivers

Rising concerns over greenhouse gas emissions and global climate change are a key driver for the hydropower generation market. With growing momentum towards transitioning to clean energy sources worldwide, governments and energy providers are increasingly prioritizing renewable hydropower development as a means to curb emissions from fossil fuel-based power generation. The International Hydropower Association estimates that hydropower currently accounts for over 16% of the world's electricity and nearly 71% of the worldwide renewable energy. Several countries have ambitious targets to expand their hydropower capacity significantly over the coming decade to meet both energy and climate goals. This is expected to drive market growth during the forecast period.

Impact of geopolitical situation on Hydropower Generation Market growth

The Hydropower Generation Market Demand is facing significant challenges due to the evolving geopolitical landscape across various regions. Geopolitical tensions and conflicts among nations have led to supply chain disruptions and shortage of critical raw materials. This is negatively impacting infrastructure development projects related to dams, reservoirs, and transmission lines. Rising nationalism and protectionist policies are also restricting cross-border partnerships and investment in hydropower projects.

However, growing focus on indigenization and decentralization of energy resources can help mitigate political risks. Developing distributed hydropower generation using run-of-river technology requires less land and has lower environmental impact. This makes such projects less prone to delays from political and social opposition. Furthermore, regional cooperation among neighboring countries for hydropower development presents multi-fold advantages. It can foster economic interdependence, facilitate knowledge sharing, and enable reliable power trading even during political disagreements.

Geographical regions concentrated in Hydropower Generation Market

The hydropower generation market is currently concentrated in Asia Pacific and Latin America regions in terms of value. Countries such as China, Brazil, India, and Canada have abundant hydropower resources and are global leaders in installed hydropower capacity. China alone accounts for over 30% of the world's total installed capacity. Many developing economies in Southeast Asia are also actively pursuing hydropower development to meet their growing electricity needs in a sustainable manner.

South Asia and parts of Africa present significant growth opportunities, however inadequate infrastructure remains a key challenge. Governments need to focus on improving rural electrification, transmission network extension and providing tax incentives for private sector investments to unlock the potential in these regions. Addressing social and environmental issues responsibly is also important to gain local community support for future projects.

Fastest growing region in the Hydropower Generation Market

The Africa region is expected to the fastest growing market for hydropower generation globally. Countries like Ethiopia, Congo, Angola and Tanzania have large rivers and adequate rainfall supporting hydropower resource potential. However, only about 10% of this potential has been tapped to date across Africa due to lack of capital investments and technical hurdles.

Now with growing African integration, several multi-country hydropower projects are taking shape. Projects such as Grand Inga in Congo, Grand Ethiopian Renaissance Dam and Rusumo Falls Dam on Rwanda-Tanzania border are flagship developments. Furthermore, utility scale off-grid solar-hydro hybrid systems are gaining traction in Rural Electrification programs. International development finance institutions are also increasingly funding these projects.

Get more insights on – Hydropower Generation Market