ABSTRACT
The surge of renewable energy sources and climate change mitigation has pushed hydropower development on the international agenda of infrastructure financing. Hydropower projects are often situated remotely and supply energy to distant locations causing conflicts between (i) locally affected communities (including indigenous groups) and their supporters (the Opponents) and (ii) project developers (the Proponents). The infringements on environmental natural resources (land and water) and livelihoods and cultural heritage can be large and often difficult to replace and mitigate, while mitigation may be perceived as unfair. At present benefit sharing is seen as a conduit to nudging local development towards meeting local needs, environmental conservations and reaching equitable long-term sustainable well-being. Experiences with benefit sharing are fresh and in the infancy stage and only now are potential mechanisms emerging as viable means of risk reduction and transforming conflicts. Limitations and challenges exist as governments and proponents of hydropower projects continue to accept non-comprehensive impact assessments, find quick and cheap solutions to mitigating impacts and compensation, do not include stakeholders (particularly affected communities) inclusively in a participatory matter, do not adhere to sound monitoring, and in some cases have to deal with corruption and mis-appropriation of funds.
