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Open AccessArticle

Hydropower Royalties: A Comparative Analysis of Major Producing Countries (China, Brazil, Canada and the United States)

HEC Montréal, Montreal, QC H3T 2A7, Canada
Faculty of Law, Université Laval, Ville de Québec, QC G1V 0A6, Canada
Faculty of Law, Université de Montréal, Montreal, QC H3T 1J7, Canada
Author to whom correspondence should be addressed.
Academic Editor: Julio Berbel
Water 2017, 9(4), 287;
Received: 18 January 2017 / Revised: 5 April 2017 / Accepted: 14 April 2017 / Published: 20 April 2017
(This article belongs to the Special Issue Water Economics and Policy)
Hydropower is the leading renewable source of electricity generation and a low emission energy source. In order to be developed sustainably, it is important that its costs and benefits are adequately set and distributed. Different mechanisms, such as royalties, can be used for this purpose. Governments have usually kept hydropower royalty rates low, without internalizing negative externalities. This strategy is inefficient because it leads to larger electricity production and consumption, and hence exacerbates environmental impacts. This paper reviews the criteria proposed and used to set hydropower royalties. It also compares practices of the four main hydropower producers in the world: China, Brazil, Canada and the United States. Results show that royalty rates and distribution policies are determined in an arbitrary and unsystematic manner, but also that water use is usually undervalued. In order to encourage the development of this key renewable resource, in a sustainable and responsible way, national and international efforts should be made to rationalize and harmonize hydropower royalty rates. View Full-Text
Keywords: hydropower; royalty; China; Brazil; Canada; United States hydropower; royalty; China; Brazil; Canada; United States
MDPI and ACS Style

Pineau, P.-O.; Tranchecoste, L.; Vega-Cárdenas, Y. Hydropower Royalties: A Comparative Analysis of Major Producing Countries (China, Brazil, Canada and the United States). Water 2017, 9, 287.

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