Yet another important source of power in the Renewable Energy field is hydro power. Flowing water creates energy that can be captured and turned into electricity. This is called hydro power. It is generated in three ways: hydroelectric power, tidal and wave power. Although micro hydro development dates back to the tea plantations in the colonial era, the availability of information on the subject is extremely limited in India. But now the growth potential that hydro possess has been recognized for special attention by both the Government as well as the private sectors. The foremost requirement for micro/small hydroelectric is a good perennial source of water at a height which can be used to run a turbine and generate electricity. This criterion is of course met by most of the sites in almost all the three cluster regions of Kargil Ladakh viz Zanskar, Suru and Drass. In Ladakh several villages witnessed the installation of micro/mini hydro plants by some NGOs and Government agencies, promoting renewable source of energy. In evaluating a potential micro/mini hydro site we need a sufficient quantity of falling water and some other considerations such as its Power Output, Economics (Costs), Permits and Water Rights etc. Kargil Renewable Energy Development Agency (KREDA) had initially chosen 11 sites for the construction of small/Mini Hydro Projects in Kargil with a total capacity of 13.2 MW. Later on, after completion of tendering and evaluation processes, the agency could go with 7 nos. only due to lack of fund.