Micro-hydro electric plants are technologies that are appropriate for the provision of electricity where the demand for power is relative low (e.g. below 100 kW) and a constant flow of running water is available . This is often the case in villages or industries located in rural regions. Micro-hydro projects are commonly designed in "run-of-river" schemes, i.e. configurations where only part of the water flow of a stream or river is deviated to drive the hydroelectric units.

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1. Potential contribution to sustainable development

Global sustainable energy supply

Micro-hydro technologies are appropriate options for providing clean and constant electric power by exploiting specifically local potentials. In regions where water flows are readily available, micro-hydro can be used to improve the provision of electricity or even cover the electric power needs of local populations and/or industries. The technology is suitable for feeding both off-grid configurations and grids in distributed schemes. Micro-hydro can therefore be an important component of the energy development plans of many countries.

Climate change mitigation

The emissions associated with micro-hydroelectric power are marginal in comparison to the greenhouse gas emissions from conventional fossil fuel plants. In rural areas, micro-hydro represents an effective option to reduce or avoid the emission of greenhouse gases produced by small-scale power generation technologies based on fossil fuels, such as engines running on diesel.

Millennium development goals

Micro-hydropower is a powerful tool in addressing energy poverty issues. It is not only suitable for the energy demand of households, but also for local entrepreneurs, local governments, schools or health centres, as well as new initiatives that aim to stimulate further economic development.

Alongside the installation of mini-grids, micro-hydro is a preferred option to ensure access to electricity in rural areas.

2. Environmental Issues

Greenhouse gas emissions associated with the operation of micro-hydroelectric plants are considered to be marginal. However, the installation of a micro-hydro system involves changes in the natural water flow of the target stream or river and this can threaten habitats that depend on the natural supply of water. A thorough assessment of the environmental impacts is required.

Changes of natural water flow

The operation of micro-hydro plants involves modifications of the natural water flow. In the case of "run-of-river“ schemes, only a section of the stream will be used  (i.e. between the intake weir and the outflow of the turbine). In the case of schemes that use reservoirs, the operation of the plant affects the water flow downstream of the dam. 

Water flow management

Changes in the water flow can have a critical impact on the habitats of local species (e.g. fishes, birds and mammals). Water management strategies should be developed where water flows are modified in order to guarantee the minimum supply of water needed to conserve the local ecosystems.

3. Social Issues

Micro-hydro is an energy supply option that can be managed by local entrepreneurs or organisations. They can therefore be important tools to foster local empowerment. Water is a key issue for many social and economical activities so the participation of local stakeholders before, during and after the implementation of micro-hydro projects is a critical issue.

Local initiatives

Micro-hydroelectric plants often form part of local initiatives to improve access to electricity among rural communities. In such cases, the power supply can also be managed and owned by locals, local entrepreneurs or organisations. Under this kind of scheme, the provision of energy becomes a key driver of economic and social development.

Investment barrier

However, the development of micro-hydroelectric projects requires significant investments, which in most cases exceeds the available capital of local communities. Rural communities also have very limited access to capital markets.

Introducing micro-hydro more widely requires the development of financing mechanisms adapted to rural realities. The most common scheme is partial or fully funding of the capital costs by government programmes or other kind of grants. Private capital only plays a rather marginal role.

Capacity building

Technical and managerial skills are a prerequisite for ensuring the continued operation of the system. The implementation of micro-hydro plants therefore has to include the training and capacity building of local individuals and organisations.

Linkages to other values

Water flows are commonly related with multiple social and economic values. The impact of a micro-hydro project can lead to synergies or conflicts with other issues. For example, the development of a micro-hydro plant can be integrated into programmes addressing other local needs such as irrigation, flood prevention, flow regulation for navigation or the fostering of tourism activities.

On the other hand, the operation of a micro-hydro plant can result in conflicts with the same issues: competition for use of water flow or negative effects such as floods or insufficient water flow after it has been adjusted to meet the energy generation needs.

Communication and consultation mechanisms

Measures to avoid conflicts and harness potentials as well as other aspects of local development should be included in the project strategies from the beginning. Communication and consultation can help to identify conflicts and potentials that already exist during the design phase of the project.

The establishment of communication and consultation mechanisms should be compulsory as they ensure that decisions taken during the long-term operation of the project (such as water flow management) also consider the needs of other socio-economic activities as well as environmental needs.

4. Development status and prospects

Most of the water turbines and generators used in micro-hydro plants are commercially available. The technologies are already mature and no significant cost changes are expected. However, in some developing countries with excellent resource availability, access to the technology can be improved by developing local hardware and software supply capacities (e.g. local production and engineering skills).

5. Economic Issues

The graphic shows the expected development of the capital costs of hydroelectric systems from two different perspectives: (1) the development of the global average costs of small hydro projects  according to the IEA1, and (2) the probable range of investment costs for three different sizes of hydroelectric systems according to ESMAP2. The ESMAP projections are explicitly based on projects in developing countries.


  1. International Energy Agency (IEA) (2008): Energy Technology Perspectives, Scenarios and strategies to 2050
  2. Energy Sector Management Assistance Program (ESMAP) (2007): Technical and Economic Assessment of Off-grid, Mini-grid and Grid Electrification Technologies


Good Practice Examples and Related Activities

All Examples in Asia