Recovering Hydropower Set to Reduce Fossil Fuels Growth

Following low generation from hydropower in 2023, global hydropower plants have seen their output soar this year, thanks to sufficient rainfalls in large hydropower-producing nations.

The recovery of hydropower output from last year’s lows could displace some of the fossil fuel use for electricity generation, Reuters market analyst John Kemp notes.

In 2023, energy-related emissions surged to another record-high level as coal use rose in major developing markets hit by low hydropower generation, the latest emissions report by the International Energy Agency (IEA) showed earlier this year.

Emissions from coal accounted for more than 65% of the increase in 2023, the IEA said. Part of the rise in coal-fired power generation was the result of a global shortfall in hydropower generation due to droughts.

Last year, major developing markets such as China and India relied even more heavily on coal power generation as hydroelectric production slumped amid lower-than-normal rainfalls that reduced water levels on the biggest rivers and depleted hydro reservoirs.     

Lower hydropower output and its replacement with coal drove up emissions by around 170 million tons last year, according to the agency’s estimates.

“Without this effect, emissions from the global electricity sector would have fallen in 2023,” the IEA said in its report. 

This year, heavy rains and enough water in reservoirs in China pushed Chinese hydropower output higher, with the strong performance of the segment seen extending over the summer as more rainfall is forecast.

China has the biggest hydropower capacity in the world, at a total of 425 GW, including the world’s biggest dam, the Three Gorges.

In another major hydropower market, Brazil, hydro output set a new record of 206 billion kWh in the first five months of 2024, according to Reuters’ Kemp.

This year, plentiful water in dams has ensured hydropower generation is high. This, coupled with soaring solar and wind power installations, has led to the lowest imports of natural gas in Brazil in two decades. 

By Tsvetana Paraskova for Oilprice.com

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