China’s National Energy Administration said the draft rules aim to promote the orderly development of the hydropower sector after decades of rampant and poorly planned capacity growth.

The regulator said small hydro plants would be banned in forest parks, scenic spots, habitats for rare fish and other “ecologically fragile” zones.

It would also be restricted in regions where large amounts of power are wasted because of limited access to the grid.

China’s hydropower sector is a major source of clean energy, with a capacity of about 350 gigawatts or around 18% of the country’s total. A third of the hydropower is classified as “small”, meaning plants with less than 50 megawatts of capacity.

China started demolishing hundreds of small dams throughout the country last year to restore water flows and comply with new rules banning industrial development in nature reserves.

The campaign came after an investigation showed there were at least 24,100 small hydropower plants along the Yangtze river and its tributaries, many causing severe environmental damage.

The crackdown was also aimed at addressing complaints by state power utilities about how the proliferation of small, privately-owned hydropower plants had hurt their profits.

The China Society for Hydropower Engineering, an academic research group, has criticised the “blind” closure of small dams.