Analyzing the Impact of Environmental Risks on the Operational Performance of Hydropower Projects
Muyonjo, Geofrey · Amolo, Amolo Elvis Juma
International Journal of Finance & Banking Studies · 2026 · Vol. / Issue · 10-20
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Abstract
Hydropower projects are vital for Rwanda’s economic growth, contributing to the national GDP and accounting for 48% of the country’s installed power capacity. However, these projects face significant environmental risks, including pollution, sedimentation, fluctuating water volumes, and natural disasters such as floods and landslides, which threaten operational efficiency and long-term sustainability. This study aimed to examine the influence of environmental risk factors, specifically pollution risk, sedimentation risk, volume risk, and natural disaster risk, on the performance of hydropower projects in Rwanda, with a focus on Rwaza Hydropower Project in Musanze District. The study is grounded in Stakeholder Theory and Risk Society Theory and adopted descriptive and correlational research designs. The target population consisted of 112 participants, including project managers, plant managers, operators, regulators, and other relevant stakeholders. The study highlights the significant negative influence of pollution, sedimentation, volume fluctuations, and natural disaster risks on the performance of hydropower projects in Rwanda. It is recommended that project managers strengthen environmental management, implement effective sediment and water volume control measures, enhance disaster preparedness, and involve local communities to sustain project performance. Future research could examine the economic impacts of environmental risks, the effectiveness of mitigation strategies, climate change effects, and community participation in improving hydropower sustainability.
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Muyonjo, Geofrey
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Amolo, Amolo Elvis Juma
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