(a) The area for the dam and reservoir should be sparsely populated. This would minimise relocation of people. It would also minimise the cost of relocating people who are to be displaced.
(b) It is important to assess the extent of the market and its contribution to the industrial development of the surrounding region before setting up an HEP project. Jinja in Uganda provides a big market for the electricity generated at Owen falls. Nairobi, Thika and other towns in Kenya are markets for the electricity generated by the power stations along river Tana.
(c) The construction of modern large scale HEP projects requires heavy capital outlay. This is because the dams have to be built and power transmission lines have to be put up. The cost of maintaining the power stations is also high. People who are displaced by the reservoirs must be compensated. In most cases, HEP projects in developing countries are financed through loans from external financial institutions like World Bank
Faimus answered the question on April 20, 2018 at 10:40
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