Hydropower Market to Reach US$ 348.2 Billion by 2030; Asia-Pacific Leads with 45% Share | Key Players: China Three Gorges Corporation, Electricite de France, Hydro-Quebec, Duke Energy

Market Overview

The global hydropower market reached US$ 244.1 billion in 2022 and is projected to reach US$ 348.2 billion by 2030, growing at a CAGR of 4.8% during 2024-2031. Hydropower continues to be a key renewable energy source worldwide, driven by innovations in turbine technology, dam design, and grid integration solutions. Although hydropower has a history of nearly 150 years, recent developments focus on improving efficiency, environmental sustainability, and integration with modern power systems.

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The sector is characterized by high initial investment requirements and longer development timelines, often relying on public-sector involvement for large-scale projects. Global hydropower generation increased by approximately 70 TWh between 2021-2022, representing a growth of nearly 2%, supported by significant capacity additions. In 2022, global hydropower capacity additions reached 32 GW, which is 40% higher than the average of the previous five years, highlighting a renewed expansion trend.

Recent Key Developments:

✅ January 2026 - Europe: Major European hydropower developers announced the commissioning of several new run-of-river projects in France and Germany, increasing installed capacity by over 1.2 GW to support renewable energy targets.

✅ November 2025 - China: China Three Gorges Corporation inaugurated advanced turbine units at the Xiluodu Dam, enhancing overall efficiency and increasing electricity output by 5%.

✅ September 2025 - North America: U.S. Department of Energy approved funding for modernization of 15 existing hydropower plants in the Pacific Northwest, focusing on digital monitoring, automation, and fish-friendly turbine upgrades.

✅ July 2025 - India: NHPC Limited launched the first phase of the Subansiri Lower Hydroelectric Project, adding 200 MW of renewable capacity to the national grid.

✅ May 2025 - Latin America: Brazil's Eletrobras commissioned upgraded Francis turbines at the Belo Monte Hydropower Plant, improving generation efficiency and reducing maintenance downtime.

✅ March 2025 - Global: International collaborations between hydropower equipment manufacturers and renewable energy tech firms were announced to develop next-generation low-impact hydropower solutions, including modular micro and small-scale plants for emerging markets.

Key Players:
China Three Gorges Corporation, Electricite de France S.A., Hydro-Quebec, Duke Energy Corporation, Centrais Elétricas Brasileiras S.A., PJSC RusHydro, Ontario Power Generation Inc., Statkraft AS., Sn Power Holding Singapore Pte. Ltd and Itaipu Binacional.

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Regional Insights:

Asia-Pacific dominates the global hydropower market, accounting for approximately 45% of the total market share in 2024, driven by China, India, and Southeast Asian countries investing heavily in large-scale and small-scale hydropower projects to meet growing electricity demand. China alone contributes significantly, with over 350 GW of installed capacity and ongoing expansions in both conventional and pumped storage projects.

Europe holds around 20% of the global market share, led by countries such as Norway, Switzerland, and Portugal. The region's focus on pumped storage hydropower and modernization of existing dams supports grid stability and integration of intermittent renewable sources like wind and solar.

North America contributes roughly 18% of the market, with the United States and Canada actively modernizing existing hydropower infrastructure and developing new small and medium-scale projects to improve energy efficiency and renewable capacity.

Hydropower Market Dynamics

The global hydropower market is primarily driven by the increasing demand for renewable energy as countries seek to transition toward low-carbon, sustainable energy systems. According to IEA projections, renewable energy supply must grow by approximately 13% annually between 2023 and 2030 to align with the Net Zero Emissions Scenario, signaling a substantial growth opportunity for hydropower. Hydropower continues to be the largest renewable electricity technology, contributing about 38% of renewable capacity and nearly 50% of renewable generation, underscoring its critical role in global energy systems.

Government policies and incentives further bolster hydropower adoption. In Europe, the commissioning of nearly 2 GW of pumped storage hydropower in 2022, particularly in Switzerland and Portugal, has supported the integration of variable renewables such as solar PV and wind. In the United States, the Inflation Reduction Act of 2022 extends tax credits for hydropower development, while more than 30 countries have established policies targeting both new and existing hydropower plants. These measures integrate hydropower into national renewable energy strategies and incentive frameworks, ensuring its continued relevance alongside other renewables.

However, the hydropower market faces competitive pressure from the rapid expansion of wind and solar PV. Over the past two decades, policy focus and incentives have heavily favored wind and solar, resulting in their accounting for approximately 85% of global renewable electricity growth in 2022, while hydropower generation increased by only about 2%. The rapid adoption of wind and solar, supported by installation targets, financial incentives, and long-term power purchase agreements, has shifted investment priorities and slightly reduced hydropower's relative market share. Despite this, hydropower remains essential for grid stability, storage solutions, and continuous renewable generation, particularly when paired with variable energy sources.

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Industry Developments

✅ January 2026 - Europe: Voith Hydro commissioned a 120 MW pumped storage hydropower project in Switzerland, aimed at enhancing grid stability and supporting renewable energy integration.

✅ November 2025 - China: China Three Gorges Corporation completed the 1,200 MW expansion of the Wudongde Hydropower Plant, boosting total capacity and contributing to national renewable energy targets.

✅ September 2025 - United States: The Bureau of Reclamation announced a $250 million modernization program for Hoover Dam, including upgrades to turbines and control systems to improve efficiency and extend operational life.

✅ June 2025 - Brazil: Eletrobras inaugurated the 500 MW Belo Monte Hydropower Phase II project, enhancing electricity generation capacity for the northern grid and supporting regional economic development.

✅ March 2025 - India: NHPC Ltd. launched a 300 MW run-of-river hydropower project in Himachal Pradesh, designed to provide clean energy to remote communities while minimizing environmental impacts.

✅ December 2024 - Europe: Statkraft announced the commissioning of a 50 MW micro hydropower plant in Norway, leveraging small-scale technology for local energy supply and community microgrid applications.

Market Segmentation:

By Technology:
The hydropower market is segmented based on technology into conventional hydropower, impoundment or reservoir, run-of-river, and pumped storage hydropower. Conventional hydropower and impoundment/reservoir systems dominate due to their established infrastructure and large-scale generation capacity, while run-of-river technologies are gaining traction in regions with smaller river flows and minimal environmental impact. Pumped storage hydropower is increasingly deployed to support grid balancing and integration of variable renewable energy sources, particularly in Europe, China, and North America, where demand for energy storage is rising.

By Application:
Hydropower applications include electricity generation, load balancing and grid stability, microgrid solutions, aquaculture and fish farms, and industrial processes. Electricity generation remains the primary driver, accounting for the majority of installed capacity, while pumped storage and run-of-river systems increasingly support load balancing and grid stability. Microgrid solutions and industrial process applications are growing in niche areas, such as remote regions or energy-intensive industries, where hydropower offers reliable, off-grid or supplemental energy. Additionally, aquaculture operations utilize hydropower-driven water flow systems for sustainable fish farming in certain Asian and European regions.

By Size:
Hydropower systems are classified into large-scale, medium-scale, and small-scale/micro hydropower. Large-scale hydropower continues to dominate due to its ability to generate substantial electricity for national grids, particularly in countries like China, Brazil, and the United States. Medium-scale hydropower projects are increasingly implemented to serve regional grids and industrial zones. Small-scale and micro hydropower installations are gaining attention for decentralized energy solutions in rural and remote communities, enabling local electricity generation with minimal environmental impact and infrastructure requirements.

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