The World Bank Group has published a new approach paper outlining how it will support hydropower development in low- and middle-income countries over the next decade.
The paper sets out a framework for supporting hydropower through two main areas: upstream policy and institutional support, and project-specific interventions. It highlights the role of hydropower in expanding energy access, strengthening energy security and supporting climate resilience.
The World Bank Group said it will focus on financing transformational greenfield hydropower projects that can help close electricity access gaps, alongside increasing support for the rehabilitation and modernisation of existing hydropower assets. The paper notes that more than 20% of global hydropower infrastructure will be over 55 years old by 2030, creating significant investment needs for refurbishment and upgrades.
According to the report, hydropower’s value extends beyond electricity generation, with reservoirs contributing to water security, flood management and climate adaptation. The World Bank Group said projects should be developed within broader water resource planning frameworks while addressing environmental and social risks through stakeholder engagement, benefit-sharing mechanisms and robust safeguards.
The institution said hydropower will remain an important component of least-cost energy development pathways in many countries, particularly as power systems integrate larger shares of variable renewable energy. The paper also highlights the need for long-term financing and risk mitigation measures to attract private sector investment in the sector.
The approach paper was prepared by a World Bank Group team led by Bente Brunes and Nicolas Sans and covers the period from fiscal year 2025 to 2035.
