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Renewable energy: A guide to understanding hydropower

It might surprise you to know that hydropower is one of the oldest forms of renewable energy in the world. In fact, according to some experts, hydropower dates back to ancient Greece where it was used to grind grains. 

But what does hydropower look like today? And how is Australia adopting this form of renewable energy? We’ve answered some of the most commonly asked questions around hydropower in the guide! 

What is hydropower and how does it work? 

Hydropower, or hydroelectricity, is a renewable energy resource that is generated through the movement of water. Similar to wind energy, electricity is created as free-flowing water spins a turbine, which transforms kinetic energy into electricity. This is done through a large-scale system called a hydropower plant. 

In Australia, there are three types of hydropower plants: impoundment, diversion and pumped storage. 

An impoundment facility is the most common type of hydropower plant. This system uses a dam to store water in a reservoir. As the water is released, it spins a turbine and activates a generator to create electricity. 

A diversion facility forces the flow of water through a canal to generate electricity. This type of system does not require a dam and is generally used near waterfalls. The system works by capturing the energy of the water before releasing it back to the river through what’s called a ‘tailrace’. 

Lastly, a pumped storage system acts like a battery by storing the power for a later use. Energy is stored when water is supplied from a reservoir at lower elevation to one that is at higher elevation. Depending on whether electricity demand is high or low, the pumped storage system will act by transporting the water from the lower to higher reservoir to spin the turbine. 

What are the advantages of hydropower? 

Other than the fact that hydropower is a replenishable energy resource, it also doesn't release any emissions into the atmosphere. What’s even better is that hydropower is said to be the most reliable renewable energy resource in the world because unlike sunlight and wind, the flow of water is generally constant. 

And because water flow is just about guaranteed, hydropower plants have the ability to adjust the current depending on electricity demand, a feature that’s unique to this renewable energy source. 

What are the disadvantages of hydropower?

Since a dam is required to create a hydropower plant, they can prevent animals from reaching breeding grounds. Plus, once water stops flowing in certain areas, habitats can start to disappear

Hydropower plants are not only expensive to build, but also can't be built anywhere. And because hydropower plants need to be built on higher ground, any towns nearby or underneath the plant are at risk of floods

Do we have any hydropower plants in Australia? 

Yes. In fact, according to the Clean Energy Council Australia has more than 100 power stations across New South Wales, Tasmania, Queensland, and Victoria. The largest hydropower plant project resides in Tasmania and is operated under the Snowy Hydro scheme. 

According to the Snowy Hydro website, the scheme consists of 9 power stations, has generated a total of 5,550MW and has supplied more than one-third of renewable energy to the national energy market (NEM). 

And in 2019, work for ‘Snowy 2.0’ began with the expectation that power generation will commence in early 2025. 

Can I use hydropower in my home?

Yes, smaller scale versions of hydropower, also called micro-hydro, can be installed within your home. However, their effectiveness will depend on a few factors, such as your home’s location and whether you have access to a stream of water. 

How else can I use renewable energy in my home? 

Hydropower might not be the right fit for many households but that doesn’t mean you can’t do your bit for a greener future. 

One option might be to have rooftop solar panels installed, where electricity is supplied through sunlight. Just keep in mind that you may also want to consider installing a battery, which allows electricity to be stored and used whenever you need it. 

Or why not start small by switching to a GreenPower plan? These are energy plans that allow you to match your electricity usage with renewable energy, which is then pumped back into the grid by your retailer on your behalf. 

Our energy comparison tool can help you compare GreenPower options in your area. All you need to do to get started is enter your postcode.


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Ceyda Erem
Ceyda Erem
Money writer

Ceyda Erem is Mozo’s authority on Energy, as well as having broader expertise as a personal finance writer. She loves to put her researching and writing talents into stories that help our readers to make more informed financial choices, whether that’s about finding the best energy deal or writing about the latest sneaky bank tricks. Ceyda has a Bachelor of Arts (major in writing) from Macquarie University.