This paper aims at clarifying the determinants that promote the community-based renewable energy development in Japan, with a special focus on micro and small hydropower. This paper analyzes a case study of the social enterprise that was established by the local residents and farmers in the Gokase Township, the purpose of which is to install and develop community-based renewable energy. To analyze the case study, we adopt the framework of the Landcare approach. The Landcare approach can be characterized by the following guiding principles: (1) a strong community initiative guided by local residents and primary producers; (2) a focus on local problems; (3) a holistic and integrated approach to tackling problems; (4) stress on community well-being; and (5) partnership and networking. There are similarities between the Gokase Research Institute of Renewable Energy (GRIRE) and Landcare in that they both focus on local issues that can be tackled by local citizens and take a holistic approach that includes not only hydropower development but also improvement in community well-being. This paper examines the fitness of each principle and reveals that all of them fit fairly well with the case of micro-hydropower development in Gokase. This implies that micro-hydropower development in Gokase can be qualitatively evaluated as sustainable from the perspective of Sustainable Development theory.