Hydropower Generation Market: Global Size, Share, Trends, Growth and Forecast 2022-2032

Hydropower Generation Market: Overview and Definition

The global market for hydropower generation is estimated at USD 249.6 billion in the year 2022, is projected to reach a size of USD 420.8 billion by 2032, growing at a compound annual growth rate (CAGR) of 6.1% over the forecast period 2022-2032. Hydropower generation is a form of renewable energy that utilizes falling water to generate electricity. It is one of the oldest and most widely used forms of renewable energy and has been in use for over a century.

The hydropower generation market has seen significant growth in recent years as a result of increased demand for renewable energy sources and efforts to reduce greenhouse gas emissions. The market is also driven by government incentives and policies aimed at promoting the use of renewable energy.

In terms of geographic distribution, Asia Pacific dominates the hydropower generation market, with countries such as China, India, and Japan being major players. Europe and North America are also significant markets, with a growing number of hydropower projects being developed in these regions.

Hydropower Generation Market: Key Drivers

There are several drivers that are fueling the growth of the hydropower generation market:

Increasing demand for renewable energy: With the increasing demand for clean and renewable energy sources, hydropower has become an attractive option as it is a reliable and cost-effective form of renewable energy.

Government incentives and policies: Governments around the world are offering incentives and implementing policies to promote the use of renewable energy sources, including hydropower. These policies provide financial support for hydropower projects and encourage the development of new hydropower plants.

Technological advancements: The hydropower industry is witnessing technological advancements in the development of new and improved hydropower plants. The introduction of new technology has made hydropower plants more efficient, reliable, and cost-effective.

Growing concern about greenhouse gas emissions: The growing concern about greenhouse gas emissions and the impact of climate change is driving the demand for clean and renewable energy sources, including hydropower.

Economic benefits: Hydropower provides economic benefits, including the creation of jobs, increased energy security, and the reduction of dependence on fossil fuels. This has led to increased investment in the hydropower sector.

Decentralized power generation: The decentralization of power generation has led to the development of small-scale hydropower projects, which can be implemented in remote areas where grid connections are not available.

Hydropower Generation Market: Challenges

Despite the growth of the hydropower generation market, there are also several challenges that the industry faces:

High capital costs: Hydropower projects are capital-intensive, with high costs associated with the construction of dams, powerhouses, and transmission infrastructure. This can make it difficult for developers to secure financing for hydropower projects.

Regulatory barriers: The hydropower industry is subject to a complex and often inconsistent regulatory environment, which can pose challenges for project development and financing. Regulations can vary from one jurisdiction to another, making it difficult to standardize the development process.

Environmental concerns: Hydropower projects can have significant environmental impacts, including the alteration of river flows, the displacement of local communities, and the destruction of wildlife habitats. These environmental concerns can lead to opposition from environmental groups and regulatory agencies, which can slow down the development of hydropower projects.

Competition from other renewable energy sources: Hydropower is competing with other renewable energy sources, such as wind and solar, which have become increasingly cost-competitive in recent years. This competition can make it difficult for hydropower projects to compete on price, which can impact their viability.

Aging infrastructure: Many existing hydropower plants are aging and require significant investments in maintenance and upgrades to continue operating effectively. This can pose a challenge for the industry, particularly in terms of cost and the need to upgrade existing infrastructure.

Hydropower Generation Market: Segmentation

The hydropower generation market can be segmented based on several factors, including:

Type of hydropower plant: The market can be segmented into run-of-river hydropower, storage hydropower, and pumped storage hydropower. Run-of-river hydropower is the most commonly used type, while storage hydropower and pumped storage hydropower are used for large-scale projects that require the storage of excess energy.

Capacity: The market can be segmented based on the capacity of hydropower plants, such as small-scale hydropower (less than 10 MW), medium-scale hydropower (10-50 MW), and large-scale hydropower (above 50 MW).

End-use: The market can be segmented based on the end-use of hydropower, such as industrial, residential, commercial, and others.

Geography: The market can be segmented based on geography, with major regions including Asia Pacific, Europe, North America, and others.

Hydropower Generation Market: Regional Synopsis

The global hydropower generation market has been analyzed across Asia-Pacific, North America, Europe, South America, and the Middle East & Africa. Asia Pacific is anticipated to be the leading regional market during forecast period, driven by increase in demand for renewable energy.

In terms of revenue, Europe captured the second position in the hydropower generation market. The hydropower generation market in Asia Pacific region is projected to grow at lucrative growth rate over the forecast period. This growth is attributed to increasing investment in hydropower generation projects in various countries.

Latin America and Middle East & Africa reported for a comparatively minor share of the global market. On the other hand, the market in these regions is anticipated to grow rapidly during the forecast period.

Hydropower Generation Market: Recent Developments

Hydropower remains one of the most important sources of renewable energy worldwide, and there have been several recent developments in the field of hydropower generation. Some of these include:

Increasing use of small hydropower plants: Small hydropower plants (SHPs) with capacities of up to 25 MW are becoming increasingly popular due to their lower cost, greater efficiency, and the ability to generate power closer to the end-user.

Development of floating solar-hydropower hybrid systems: These systems combine floating solar panels with hydropower plants to optimize land use and increase power generation efficiency.

Use of pumped storage hydropower: Pumped storage hydropower (PSH) is becoming increasingly important as a flexible and reliable way to store energy, especially in conjunction with variable renewable energy sources like wind and solar.

Expansion of hydropower in developing countries: Developing countries are investing in hydropower to meet their growing energy needs and address the challenge of energy poverty.

Advancements in hydropower technology: Improvements in technology, such as more efficient turbines and better control systems, are making hydropower plants more effective and cost-competitive with conventional power sources.

Hydropower Generation Market: Key Players

• Alstom Hydro
• Andritz Hydro USA Inc
• China Hydroelectric Corporation
• China Three Gorges Corporation
• CPFL Energia S.A
• GE Energy
• IHI Corporation
• Sinohydro Corporation
• Tata Power Corporation
• ABB Ltd