Replacing traditional fuels with electricity can reduce air pollution, improve health, and reduce social burdens, such as firewood collection. Electricity can be used to increase income-generating activities, such as irrigation, crop cultivation, and food production. Income-generating activities can provide more jobs for rural communities.
A study for the UK Department for International Development found that the potential for small hydropower to reduce poverty is significant, especially in low-income countries. It was also found that micro-hydro is a relatively effective method of poverty reduction in terms of the cost per person above the poverty line. In addition, estimates of poverty reduction from micro-hydro are systematically underestimated because they exclude a number of very difficult to measure but important effects, including savings from no longer having to carry firewood, kerosene or other fuels, improved education through the availability of electric lighting, and improved health and agricultural production through drinking and irrigation water that is available through canals originally built for micro-hydro schemes.
Small hydropower, being a renewable energy source, also has the advantage of reducing dependence on fossil fuels at the macroeconomic level if a country imports fossil fuels.
Contribution of the technology to environmental protection
Depending on what forms of energy use a hydropower plant replaces, the reduction in air pollution and greenhouse gas emissions varies, but given that small hydropower is virtually CO 2 neutral, it is expected to be a significant improvement over conventional power generation in terms of greenhouse gas and air pollutant emissions.
Unlike large hydropower plants, the environmental impact on ecosystems is limited. Small hydropower plants require limited changes in river flow and therefore the existing ecosystem can continue to function as before; however, improvements in this area are expected, particularly related to the development of turbines that promote “fish growth”.