Small hydropower systems installed worldwide are expected to grow to 146.65 GW by 2023, according to new analysis.
This is up from the current global installed capacity of 119.35 GW, a CAGR of 2.85%. So says a newly releasedà‚ market report from consultancy Transparency Market Research (TMR).
Asia will account for the largest growth due to growing demand for off-grid power in rural areas of India and China. By 2023 the region is expected to account for almost 60% of the market.
The Middle East and Africa are predicted to see a CAGR of 14.5% during the same period due to their high untapped hydropower potential and increasing turn to renewable power sources.
Growth is also expected to be driven by the lack of fuel cost and low capital investment required for small hydropower installations.
However, the report noted that barriers to adoption are still significant. One such barrier is fluctuating water flow in rivers and streams due to unfavourable climate conditions and unpredictable natural disasters.
An example given was China’s Zhengyixia hydropower station on the banks of the Heihe River, which has produced high amounts of power between July and October but little or no power in May, June and November.
In addition, footholds established by significant players in the small hydro market, including Andritz Hydro, Voith and Alstom, have increased competition and created high barriers for new market entrants, the report said.