The Hydropower Sustainability Council (HSC) has launched an environmental, social and governance (ESG) performance standard, in a move it hopes will provide investors with more confidence in backing new projects.
The HSC is a global body made up of representatives from energy companies, government agencies, financial institutions and social and environmental NGOs.
Hydropower supplied one sixth of global electricity in 2020 but there is concern in some quarters as new projects have slowed, partly due to lengthy permitting processes, risks from environmental assessments and opposition from local communities.
“The hydropower sector needs a credible, transparent certification scheme that will incentivise the best projects,” Ashok Khosla, chair of the HSC said in a statement.
“This will give communities, governments and investors greater confidence about their net benefits and how impacts on the local environment are mitigated,” he said.
Under the new ESG standard, developers will need to put forward projects for the certification which will be assessed by independent experts using several criteria such as labour and working conditions, climate change mitigation and resilience, community impacts and biodiversity impact.
Several global hydropower project participants said they would seek to achieve the new standard.
“We will not participate in hydropower projects which do not fully comply with the requirements set forth in the Hydropower Sustainability Standard,” said Pascal Radue, president and CEO of GE Renewable Energy Hydro Solutions.