In terms of fuel resource, hydropower possesses a prominent advantage over any other large power plants which burn fossil fuels to generate electricity. Moreover, due to the abundance in resource availability (as a domestic source in small streams and rivers), small hydropower (SHP) plants are showing prominence all over the world. SHP plants have led to improved access to electricity usage in under-developed and developing nations, thereby contributing to sustainable development goals and social empowerment. SHP, as a technology, is regarded as the largest density renewable resource with high adaptability, and low investment costs. The primary objective of the paper is to study and analyze recent developments in SHP technologies with reporting statistical figures in terms of installed capacity and MW potential in several parts of the world. Methodologies adopted by researchers to conduct techno-economic analysis of SHP projects are reviewed. Various costs involved in conducting pre-feasibility studies—such as constructing, maintaining, and sustainably operating SHP projects—are studied. The results of the study indicate cost and regulatory issues are the major factors affecting the growth of the small hydropower sector in many nations. Major impediments to construction, development and deployment of SHP projects, mutually existing among the nations worldwide, are also reported. Technical hindrances include non-availability of the grid and very limited accessibility to SHP sites, emissions due to storage of water, disruptive technologies with limited manpower and non-technical hindrances include discouragement from local bodies and groups, lack of suitable and precise pathways to accomplish SHP goals of a nation, lack of incentives for encouraging private players to invest in SHP projects, complex approval processes, and many more.
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