Concerns about climate change brought about by the increasing usage of fossil fuels has made it imperative to develop sustainable energy usage based on renewable sources. Micro-hydel plants are an important source of renewable energy that can be exploited to supply requirements of local loads in remote locations while operating as an isolated source, or the larger network when operating in grid connected mode. The focus of this research is to develop an alternative topology to the one currently in use in micro-hydel power plants. While existing plants are based on a ballast-controlled, fixed-speed, operator-supervised model, the proposed work introduces a ballast-free, variable-speed generator capable of unsupervised operation. Conventional micro-hydel generators use o-the-shelf machines with the purported aim of reducing costs. They run at a fixed speed, maintaining constant electrical load by switch-ing a plant-situated ballast load to compensate for consumer load changes. Although the intention is to have a simplified control scheme and reduced costs, the conventional plants end up being expensive since the balance-of-system costs are increased. The plant re-quires supervision by a trained operator and frequent maintenance, failing which the reliability suers. The cost and maintenance reduction possible is analysed by comparing the proposed topology with a typical well designed conventional micro-hydel plant. The proposed topology takes the characteristics of the turbine into account, and by running at variable speed, ensures that only as much power is generated as required by the consumer load. This eliminates the ballast load and associated problems present in conventional plants. The generator can be connected to the grid, if present, enabling the available power to be fully utilized. The behavior of a hydraulic turbine operating at a fixed head and discharge rate with no flow control is analyzed. Based on the turbine characteristics, a generator topology is developed, which operates in a speed range dictated by the characteristics of the turbine. Continual supervision is unnecessary since the operation of the generator is within safe limits at all times. A simple emulator that can mimic the steady state and dynamic behaviour of the turbine is developed to test the proposed generator. The two-machine wound rotor generator proposed has an auxiliary exciter similar to a conventional brushless alternator with the additional provision for bidirectional power transfer. The shaft mounted rotor side electronics facilitate brushless operation, and to-gether with the stator side controllers form an embedded system that does away with having to tune the plant in-situ. The control scheme is evaluated for expected perfor-mance in dierent operating modes. The thesis also discusses an optimization of the synchronous speed of the generator with respect to the turbine characteristics. This minimizes the bidirectional slip power transfer requirements of the rotor side converters and leads to the lowest rating for the auxiliary machine. The proposed generator can then operate like a conventional synchronous gen-erator in the grid connected mode with a simplified control scheme.