Big hydro uncertainties –

Big hydro uncertainties –

(Image courtesy: iStock/ChrisGorgio)

Hydro is the largest renewable energy resource in use so far. There’s nearly 1.2 TW installed globally, which supplies about 16% of the world’s electricity. Continued expansion seems likely but may be constrained by environmental objections. There are certainly growing concerns about eco-impacts and also the wider social and economic issues. In that context it’s interesting to see that a new study by the Science and Technology Policy Research Unit (SPRU) at the University of Sussex, UK, and the International School of Management in Germany suggests that “current calls for substantial, global investment in hydropower installed capacity and generation, including those from major institutions such as the International Energy Agency, IRENA, IPCC and World Bank, must be closely scrutinized”.

The study compared the security, political governance, economic development and climate change performance of major hydropower states against oil-producing states and all other countries using 30 years of World Bank data. It found that, although net emissions were reduced, countries relying on hydro power saw poverty, corruption and debt levels rise and their economy slow at significantly greater rates than nations that used other energy resources. In addition, carbon reduction benefits were realized only over time, after an initial environmental impact from construction, while the financial benefits of major hydropower projects could take decades to emerge.

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The report certainly presents some worrying accounts of hydro’s social and economic impacts. It notes that the World Commission on Dams estimated that about four million people were displaced each year by hydro construction or operation, while another study looking at global energy accidents over 100 years found hydroelectric dams were responsible for less than 1% of total energy accidents but caused 94% of reported fatalities and $9.7 billion in damages. The report also points to the large budgetary overspends often associated with major hydro projects. The SPRU press release even says that “the era of the awe-inspiring mega hydropower projects such as the Hoover Dam in the US and the Three Gorges in China should be coming to an end in favour of smaller projects”.

However, the report itself is more measured. It notes that the “shortcomings of dams, though real, may pale in comparison to the deleterious effects of other policies, programs and investments”, e.g. nuclear power or coal, given that hydro projects “generally perform better on selected indicators, especially carbon footprints and energy payback ratios”. And it also says “in some cases the benefits of hydroelectric dams outweigh their costs, though these benefits may occur in urban areas far removed from the dam itself”. So it rows back a bit.

Reduced emissions

In particular, the SPRU report says that the contention that hydro projects can lead to significant net environmental impacts was not supported by their data. It notes that hydro projects certainly can have negative impacts on habitats, water quality and environmental sustainability but they also have positive impacts in terms of avoiding emissions. Interestingly, the report cites the assertion that hydro reservoirs can “become virtual methane factories, with the rise and fall of the water level in the reservoir alternately flooding and submerging large areas of land around the shore; soft green vegetation quickly grows on the exposed mud, only to decompose under anaerobic conditions at the bottom of the reservoir when the water rises again. This converts atmospheric carbon dioxide into methane, with a much higher impact on global warming”. But it says that, overall net negative emission impacts were not found in the study — hydro “reduced greenhouse gas emissions per capita”.

Nevertheless, hydro is still a conflicted technology that attracts much opposition, large projects especially, not least due to the local disruption they can impose. As the report notes, “studies have suggested that in rural areas hydropower projects may exacerbate poverty by interfering with food security, especially the vitality of fisheries or availability of agricultural land”. Such projects can also “contribute to capture of resources by the elite, exacerbating concentration of wealth and/or marginalizing of ethnic minorities and indigenous groups”. The contention that hydro projects increased poverty levels was partly supported by the study’s data.

Which nations build dams, who benefits from them, and who suffers their costs—who wins and loses—must remain a central part of examining the promise—and peril—of hydropower

Benjamin Sovacool and Götz Walter

The risk of corruption was also likely to be high for large projects. The report cites the assertion by Transparency International that “the hydropower sector’s massive investment volumes and highly complex, customized engineering projects can be a breeding ground for corruption in the design, tendering and execution of large-scale dam projects around the world. The impact of corruption is not confined to inflated project costs, however. Large resettlement funds and compensation programs that accompany dam projects have been found to be very vulnerable to corruption, adding to the corruption risks in the sector”. That contention was also partly supported by the study’s data, as was the hypothesis that economic growth was also reduced, while debt levels were increased. The report notes that “many of the revenues from hydropower construction or operation flow out of national economies to foreign investors” while “cost overruns and diseconomies of scale frequently associated with hydropower projects are corrosive to fiscal discipline”.

Authors Benjamin Sovacool (SPRU) and Götz Walter (ISM) say the report should be a warning to the cheerleaders of major projects such as the Grand Inga Dam in the Democratic Republic of Congo, an $80 billion project costing twice the country’s annual GDP, who promise speedy and far-reaching economic impact on a transformational scale. While hydroelectricity brought countries improved energy access, economic development and positive spillover effects, the championing of large-scale dam projects to bring about industrialization was not supported by the data analysis.

Small future?

However, Sovacool added, “even though hydropower might not bring immediate and all-encompassing benefits to a country, it is still a vital source of renewable energy” and the report’s authors say that smaller-scale, run-of-river designs that operate without reservoirs, as deployed in Nepal, Tanzania and Sri Lanka, could be used more widely to limit the risk of corruption and environmental problems, and increase developmental outcomes while still producing sufficient energy to meet demand. So we could refocus on community-based mini, micro and even pico hydro.

That’s a view shared by many environmentalists and, up to a point, by some analysis but it does conflict to some extent with the role that hydro, especially pumped hydro storage projects with large reservoirs, might play in helping to balance variable renewables like wind and solar photovoltaics (PV). For example, there have been proposals to convert the giant Hoover dam in the US to pumped storage and many other projects around the world could be used that way.

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There may be a need for some strategic trade-offs. The report concludes: “While our results suggest that hydropower dams do help in decarbonizing national economies, at least insofar as per capita carbon dioxide emissions fall, such a low-carbon pathway comes at a cost in terms of economic and sociopolitical dilemmas. In sum: the political economy of hydroelectricity is also about perpetually managing a series of pernicious risks, not always optimally. Which nations build dams, who benefits from them, and who suffers their costs – who wins and loses – must remain a central part of examining the promise – and peril – of hydropower.”

Hydro does seem to be at something of a crossroads. Apart from the issues discussed above, climate change is already having an impact on its reliability as a baseload power supply in some drought-prone regions. That will only get worse, while non-water-constrained renewables like wind and solar PV are accelerating ahead. Their combined capacity will soon overtake that of hydro. But they will need balancing capacity. In 2013 there was over 127 GW of pumped hydro storage capacity in use globally (in 2015 it represented 99% of global electricity storage capacity). And demand is rising, with more being built, usually small- to medium- scale. As already noted, some large existing hydro plants may also be converted for pumped storage use, as may some smaller projects, but it is unlikely that many very large new river-based hydro plants will be built just for pumped storage. A recent study suggested there were potential sites globally for 22 million GWh of new pumped hydro supply capacity. That’s much more – if it could be linked up appropriately –  than could ever be needed for grid balancing. However, most of that would be non-river-based “closed loop” systems, with water shifting between high and low reservoirs. In parallel, there could be growing demand for smaller run-of-the-river hydro projects to enhance the local decentralized mix — they can be built in areas unsuited to large centralized projects. Some new lower-impact mini-hydro technologies are also emerging. So there are plenty of technical options on the hydro agenda to enliven the strategic debate.

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