Hydropower dam

Hydropower harnesses the energy from water in our environment to generate electricity, which we can then use to power our homes and businesses. Alongside industries such as bottled water production and whisky distilling, this is another example of how Scotland’s water resources are a huge advantage to our economy. Combining high rainfall with mountainous terrain makes Scotland ideal for this form of electricity generation, so it’s not surprising that Scotland has been successfully using hydropower schemes for over a hundred years.

Today, the hydropower industry stands as an extremely important part of the sustainable economic development of Scotland. Once a hydropower scheme has been set up and the equipment installed, the cost of electricity generation is highly economic – both in terms of cost and carbon emissions. Currently, around 5000GWh (Gigawatt hours) of electricity from hydropower are produced every year; that’s enough to power roughly half of Scotland’s homes. This success is set to continue now that the Scottish Government has identified sustainable hydropower as a key part of Scotland’s lower carbon future.

However, if not constructed or maintained in accordance with best practice, hydropower can seriously impact on river ecology and fish stocks. In the worst case, rivers could be dried-up completely for hundreds of metres downstream. So, striking the right balance between protecting the water environment and renewable energy generation is vital.

Have a closer look at a run-of-river hydropower scheme and how it generates electricity.

What is our role?

Due to the potential impact on river ecology, developers of hydropower schemes require a water use licence from SEPA. Before granting a licence, we will assess any likely negative impacts the scheme may have on the water environment, feasible ways to mitigate against these impacts, and the potential benefits, including its contribution to renewable energy generation.

We have produced guidance to help developers understand how we carry out hydropower regulation. We aim to reduce business uncertainty by enabling developers to have easy access to technical advice and assess the likelihood that a proposal will be permitted. We understand that planning a scheme and applying for a licence does incur costs, and that sometimes this can be a barrier for developers of small schemes, including farmers, in pursuing potential developments. 

Hydropower in practice: An example from Perthshire

Scottish company Green Highland Renewables has built and operates a small hydropower scheme, located on a tributary of the River Lyon, the first to be developed as part of the Glen Lyon Partnership, which was formed between landowners in the glen.

Glen Lyon is recognised as a National Scenic Area, a Site of Special Scientific Interest and a Special Area of Conservation due, in part, to the large number of protected species in the area, including Atlantic salmon, otters and freshwater pearl mussels. All this had to be taken into account when designing the scheme in order to safeguard the water environment.

The scheme is a typical small hydropower project, comprising a weir structure, penstock, powerhouse and outfall. The scheme generates approximately 2500MWh (megawatt hours) of energy per year, which is enough to supply around 600 homes. The electricity is sold to the grid. The project was one of the first hydro projects in the UK to benefit from the Feed in Tariff scheme (FiTs), which provides renewable generators with a guaranteed energy price. 


SEPA has a dedicated team that only deals with hydro related queries and applications, and we recommend you get in touch as early as possible if you are thinking about pursuing a development. You can contact the team by
e-mail.