In hilly areas of the world, one source of energy is that from moving water. Small turbine technology has been developed in many countries that can allow both shaft power and electricity to be generated from small streams flowing down hillsides cheaply and efficiently. SHP plants have certain inherent advantages: they generate clean energy at a competitive cost; they have features that make them suitable for peaking operations; they are less affected by rehabilitation and resettlement (R&R) problems. The negative impacts of SHP on environment and socio-economic are very less. They must be reduced and positive impacts should be increased so as to result in good economic life of surrounding villages.