Hydropower involves two of the most pressing global environmental challenges of modern society – accelerated biodiversity loss and climate change. On one hand, hydropower provides a reliable source of renewable energy. On the other, it contributes to significant biodiversity loss in freshwater ecosystems. Mature hydropower producing countries must increasingly restore habitats damaged by existing hydropower projects while attempting to increase their production of renewable energy. Meanwhile, developing hydropower countries are only beginning to craft regulations for their burgeoning hydropower industries.

The authors conclude that the United States has achieved greater ecosystem restoration, primarily due to its hydropower licensing framework. In the United States, regulators issue licenses for a limited term of thirty to fifty years. After the license expires, the operator must obtain a new license compliant with current environmental laws. In Sweden, licenses are perpetual, and only the environmental laws in effect at the time of the original licensing bind dam operators. Countries can strengthen laws governing hydropower operations by learning from the different extent of river restoration in these two similarly situated hydropower-producing countries.

To improve hydropower regulation in developed countries and to create effective regulations in developing countries, the following two elements are essential: (1) mandatory, periodic review of licenses to adapt to new laws, changed circumstances, and scientific improvements; and (2) placing the burden of proof on project operators to demonstrate that a given project serves the public interest.

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