Run-of-river and small hydro: Correlation
Prices it moves with, and why
Run-of-river and small hydro plants use stream flow without large reservoirs. Costs are civil works, pipes, turbines and grid links in remote hill areas, and output follows the seasons, so rainfall and tariffs set their value.
Proxy US PPI: turbines and turbine generator sets index (BLS base period =100) · monthly, Jun 2011 to Sep 2026There is no free public price for run-of-river and small hydro itself, so this tab uses the closest public series as a stand-in. Read the numbers as an indication, not as the price of this exact item.
What its price moves with
Selected linkRun-of-river and small hydro and Water
Monthly changes 0.09 little or none correlation 12-month changes -0.28 weak correlation Last 5 years 0.16 monthly changes Lead or lag none No clear lead or lag Price function, Oct 2018 to Sep 2026 Run-of-river and small hydro ≈ 129.2 × (Water)-0.02 R² 0.01 On this fit, a 10% higher water price goes with a −0.2% lower run-of-river and small hydro price over the long run. Units: index (BLS base period =100) and $/acre-foot. The fit is loose, so treat the function as a rough guide.Chart: Run-of-river and small hydro and Water prices rebased to 100 at Oct 2018, log scale
Both prices rebased to 100 at Oct 2018, on a log scale so equal percentage moves look the same size.Chart: Run-of-river and small hydro price against Water price, monthly, log scales, with fitted line
Each dot is one month; paler dots are older (2018), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic.Output follows river flow, which peaks in the monsoon and snowmelt and falls in dry months. The US water index is a California market price, so it shows local scarcity rather than small hydro costs.
little or none co-movement month to month · 96 months Show chartsPenstocks, gates and turbines use steel. The proxy is a US turbine price index shared by several power technologies, and it does not track steel monthly (0.05) because equipment is priced on contracts.
little or none co-movement month to month · 184 months Show chartsSmall turbines drive generators, a large part of equipment cost. The US generator index and the turbine proxy share an equipment cycle, with yearly changes correlating at 0.52. Small units are often bought ready-made.
little or none co-movement month to month · 184 months Show chartsSmall and micro hydro schemes often use plastic pipes made of HDPE for penstocks. The resin proxy and turbine index show little link, with monthly moves at 0.09 and yearly moves at -0.11.
little or none co-movement month to month · 184 months Show chartsGenerator windings and lines to the grid use copper. Remote hill sites need long lines, so copper cost can matter more than for plants near cities. Copper theft from remote lines is also a problem.
little or none co-movement month to month · 184 months Show chartsHow to read these numbers
Correlation of monthly changes (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak.
12-month changes compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs.
Price function is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation.
Lead or lag checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months.
Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link.
Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site.