Megatrends and hydropower
Possibilities and opportunities for the global hydropower market
Megatrends like urbanization, climate change and the digital transformation are fundamentally changing all aspects of our lives. Change can be challenging but also offers scope for positive change and for even greater opportunities for those companies, organizations and societies willing to embrace new realities.
Although the technically feasible potential of hydropower is an unbelievable 16,000 TWh per year, today not even one third of this potential has been exploited. Around the world people are working to develop this huge clean energy potential by building new hydropower plants, as well as modernizing and upgrading existing ones. According to the 2021 Hydropower Status Report from IHA, an estimated 21 GW of hydropower additions took place in 2020 alone, bringing the total installed capacity to 1,330 GW (including pumped storage) and producing some 4,370 TWh, close to 17% of the world’s total electricity generation.
In regions where energy demand will increase dramatically in the next few years – such as in Asia, South America, and Africa – new large plants and a multitude of small hydropower projects will be implemented. There is also huge potential in Europe and North America, since half of the facilities here are older than 40 years and can make a more significant contribution toward power supply in the future through modernization. Alongside its environmentally friendly generation characteristics, the benefits of pumped storage hydro to provide flexibility and cost-effective bulk storage make it an invaluable asset for the clean energy transition.
The IEA’s Net Zero by 2050, A Roadmap for the Global Energy Sector forecasts that hydropower generation will grow by at least 9.5% through to 2025 to reach 4,650 TWh but the report also notes that hydropower capacity growth during 2023 – 2025 could be 50% higher per year on average if project development were accelerated. It is critical that all opportunities to develop the huge potential for sustainable hydropower are embraced to secure our world for future generations. Indeed, IRENA’s Global Renewables Outlook estimates that an additional 850 GW of hydropower is required by 2050 for the world to stay on a climate-safe track in line with the Paris Agreement.
With 180 years of innovation, ANDRITZ has long been at the forefront of development, responding to megatrends with pioneering technologies and concepts and leading the transition to new and better approaches to meet the needs of society. That philosophy holds as true today as it did when the company was first founded. Faced with the profound impacts of global megatrends, hydropower and ANDRITZ innovation will be a long-term megatrend too.