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How climate finance can help repurpose hydropower

Sejal Patel, Neha Rai, Clare Shakya

IIED Briefing, 4 pages

Climate funds should facilitate the transition to a low-carbon and climate-resilient future. Energy storage and ancillary grid services are critical to expanding the proportion of intermittent renewable generation on the electricity grid. Hydropower remains the largest and most cost-effective provider of bulk energy storage, offering the flexibility to provide most other recognised grid services. While sustainable hydropower may not broadly meet climate finance criteria, hydropower projects with the necessary characteristics for transition do meet these objectives and should attract climate finance support. Meanwhile, concerns about the social and ecological integrity of hydropower, such as impacts on local communities, provide more reasons for climate finance to incentivise hydropower designs that are socially, environmentally and technically appropriate for future conditions, supporting the shift to accessible, affordable, clean, distributed smart grids.

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