The International Hydropower Association (IHA) is partnering with Sustainable Energy for All (SEforALL) to explore options for a new model which would accelerate sustainable hydropower development worldwide.
The two organisations signed a partnership agreement in November at the COP23 climate change conference in Bonn, Germany. It will see them consult on the concept of a Hydropower Preparation Facility (HPF), which would work with national governments to prioritise potential hydropower project sites according to their sustainability.
The concept could see Hydropower Preparation Facilities established in countries and regions across the world, which would help governments select and prepare hydropower projects before putting them out to tender to the private sector.
Under the model, a project ‘blueprint’, guided by the latest international industry good practice in sustainability, would be created by the facility and then auctioned off. The successful developer would subsequently repay the preparation costs when the project is commissioned, reducing the costs and risks to prospective developers. The facility itself would be resourced through a revolving donor-sourced fund.
The International Hydropower Association has been engaging with governments, financial institutions and NGOs to bring forward the HPF concept following the strong support it received from stakeholders at the World Hydropower Congress in May 2017.
“The initiative is about getting the right projects built in the right place, and delivering services where they are needed most, especially in developing countries,” said Richard Taylor, Chief Executive of IHA. “The aim is to accelerate sustainable hydropower that fits well with local, national and regional strategies – contributing to cleaner energy systems, responsible freshwater management and climate-change solutions. The partnership with SEforALL represents a significant milestone in making this concept a reality.”
Rachel Kyte, Special Representative of the UN Secretary-General and CEO, Sustainable Energy for All, added: “We can only reach universal energy access by 2030 if the shift to renewable energy moves at speed and scale. Best practice hydropower can deliver renewable energy and storage opportunities – offering much needed flexibility. By partnering together, we can help IHA share their leadership and expertise with a much wider audience of sustainable energy policy makers and practitioners. Together, we can go further, faster towards Sustainable Development Goal 7.”
Hydropower Preparation Facilities could assist in defining the energy and water benefits required from a hydropower project by utilising local stakeholder knowledge and public-private partnerships at the early stage, and by checking the viability and sustainability of the project before auction.
The HPF concept avoids the risk premium associated with a private developer attempting to bring forward a project with costly, often complex, assessments and planning, with no certainty that it will be permitted to proceed. By taking a system-scale approach and working closely with host governments and local communities, projects would also have a strong strategic fit within their region.
IHA and SEforAll plan to hold a series of meetings and events over the coming year with key stakeholders to identify a proof of concept for the HPF model. In particular they will assess how HPFs could be driven by revolving funds and utilise refinancing models aligned with the key stages of project development.