Small Hydropower (SHP) Market - Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2023-2030 - By Product, Technology, Grade, Application, End-user, Region: (North America, Europe, Asia Pacific, Latin America and Middle East and Africa)

The global push to minimize the carbon footprint of the electricity generation industry has spurred the widespread acceptance of renewable energy sources, with small hydropower emerging as a prominent player in the market. Various policies, including subsidies, feed-in tariffs, power purchase agreements (PPA), and import/export tariff reductions, have been implemented to encourage the growth of the hydropower market. In 2019, hydropower accounted for the majority of renewable electricity generated worldwide, a trend expected to continue in the foreseeable future. The small hydropower segment has experienced steady growth over the past two decades, offering immense opportunities for key stakeholders.

Government Support and Awareness Essential for Small Hydropower Development

The hydropower market has witnessed unprecedented growth, driven by the demand in developing economies that have yet to fully exploit their hydropower resources. Small hydropower projects are supported by ambitious green recovery plans that require significant investments in green initiatives. The lower investment costs of smaller hydropower plants, especially for drinking or wastewater networks, make them an attractive option. It is projected that renewable energy should account for one-fifth of global energy generation by the end of this decade, with small hydropower poised to play a prominent role. Despite its appeal, the full potential of small hydropower remains untapped. While policies and optimization frameworks have been introduced to promote small hydropower, further efforts are needed to unlock its market potential.

Shifting Profitability from Europe to Africa in the Small Hydropower Market

In 2020, China, the US, Japan, Italy, Norway, and Turkey accounted for approximately three-fifths of the global small hydropower market. India surpassed Japan in 2019 to become the world's fifth-largest hydropower producer. Europe has witnessed significant small hydropower development, with the majority of its capacity already utilized. However, the market's profitability is shifting towards Africa, where untapped opportunities for small hydropower projects exist.

Customizability Makes Small Hydropower Ideal for Rural Off-the-grid Areas

Small hydropower plants, with their relatively lower power delivery capacity, are well-suited for meeting individual off-grid requirements. Off-grid small hydropower solutions have become crucial in expanding access to renewable energy in remote areas that lack connection to a central grid. Rural areas often face a lack of communication infrastructure and reliable lighting, and small hydropower can be customized to suit the needs of individual communities, making it highly desirable for infrastructure development.

Key Market Players

The small hydropower market report profiles several key companies, including Voith GmbH & Co. KGaA, Velcan Energy, Marubeni Corporation, GE, Siemens AG, ANDRITZ, Toshiba Corporation, Gilbert Gilkes & Gordon Ltd, BHEL, and Natel Energy. In early 2021, Voith GmbH was awarded a contract to build a small hydropower plant in France, scheduled to be operational by 2024.