Recent devastating floods in Nepal, which have claimed over 1,000 lives and left nearly 4,000 people missing, have reignited debate over the role of large dams in managing the country’s increasingly volatile river systems. While dams have long been criticized for environmental and social impacts, experts argue that they remain a critical tool for flood control, hydropower generation, and climate resilience in mountainous regions.
Nepal’s rugged river valleys have traditionally faced the threat of seasonal flooding, exacerbated by climate change and rising temperatures that destabilize soil and increase the frequency and severity of flood events. At the same time, infrastructure development, including roads, tourism, and settlements, continues to transform remote areas. The question is no longer whether Nepal’s rivers will be harnessed, but how this development can be structured to improve safety and sustainability.
Historically, large dam projects have been controversial. For example, India’s construction of reservoirs along the Narmada River led to the displacement of hundreds of thousands of marginalized people, triggering widespread protests and prompting multilateral development banks to halt funding for large hydropower projects during the 1990s. This shift contributed to a steep decline in support for hydroelectric power globally, despite its advantages.
Hydropower offers significant benefits, including the provision of affordable, zero-carbon electricity that can be stored and dispatched on demand. Large reservoirs with storage capacity help regulate river flows and mitigate downstream flooding. Instances such as the 2018 landslide-induced Yangtze River dam event demonstrate how coordinated water management can substantially reduce flood damage. Similarly, European reservoir dams have lowered extreme river levels by approximately one-third in recent decades, according to a 2022 study.
Despite reduced donor enthusiasm, hydropower development has continued, often financed domestically. China built the massive Three Gorges Dam largely without external aid, while Ethiopia self-funded its Grand Ethiopian Renaissance Dam amid regional opposition. Tanzania is following a similar path. In Nepal, most hydropower projects are run-of-river plants, which harness river flow without significant storage capacity. These projects, accounting for about 90% of the country’s hydropower, provide intermittent power but offer limited flood control benefits. Notably, several workers missing or rescued after flooding in recent construction were involved in such projects.
Despite calls from institutions like the World Bank to rebalance funding, hydropower has struggled to secure a meaningful share of global renewable energy investments. In 2022, major development banks allocated only 2.8% of energy funding to hydro projects—the lowest level since 2009. Since the 2015 Paris Agreement, hydropower has received $8.67 billion, trailing behind fossil fuel funding, which reached $12 billion.
Nepal’s abundant water resources and relatively small population give it considerable potential to generate and export hydropower to neighboring countries. However, up until 2023, the country imported more electricity from India than it exported and only recently launched a transmission line to Bangladesh. Despite ongoing construction, Nepal has developed just 3.4 gigawatts of the 42 gigawatts of economically viable hydropower potential, with 4.3 gigawatts under construction.
The critical issue moving forward is whether Nepal will invest in storage dam projects that can offer reliable electricity while providing flood protection to downstream communities, or continue relying predominantly on run-of-river plants that lack these benefits. As climate risks escalate, infrastructure that balances energy needs with hazard mitigation may be essential to safeguarding lives and livelihoods in the region.