This paper aims to evaluate the development of small hydropower (SHP) in Turkey and discusses the current situation of SHP plants in terms of government policy, economical aspects and environmental impacts taking EU policy into account. The laws published in recent years in Turkey succeeded in promoting the utilization of renewable energy for electricity generation, but it is considered that those laws are not fully compatible with EU policy. After the publication of Renewable Energy Law (Law No. 5346) there occurred a boost in SHP project along with hydropower development. Thus, the hydropower potential of Turkey increased 15% and the construction of hydropower plants also increased by a factor of four in 2007 as compared to 2006. Investment and operating costs are in favor of SHP development in Turkey as having the lowest costs among European countries (300-1000 (sic)/kW as investment cost and 1 (sic)cent/kWh as operating cost). Turkish governments have taken precautions for environmental issues resulted from renewable energy utilization but these are obviously not adequate. It is concluded that more attention must be paid on environmental issues and monitoring of the facilities must be enabled with further laws or regulations. (C) 2009 Elsevier Ltd. All rights reserved.