Hydropower reservoirs are essential for the climate-neutral development of East Africa. Hydropower production, however, is threatened by human activities that lead to a decrease in water storage capacity of reservoirs. Land use/land cover and climatic changes are driving accelerated soil erosion in semi-arid East Africa, which ultimately increases reservoir sedimentation and decreases energy production. Sediment delivery dynamics at the catchment scale are complex, involving the interaction of multiple factors and processes on different spatial and temporal scales. A lack of understanding of these processes and their interactions may impede the efficiency of sediment mitigation and control strategies. A deep understanding of the processes of erosion and connectivity of the land to river channel, as well as storage of eroded material within hillslopes and floodplains, and sediment accumulation in the reservoirs supports selection of future dam locations and sustainable management of reservoirs. The sediment budget approach can provide such a holistic perspective by accounting for the various sediment sources, transport, sinks, and redistribution when the sediment is routed through that catchment. Constructing sediment budgets is challenging, but the potential for integrating a number of different techniques offers new opportunities to collect the required information. In East Africa, the spatial planning of dams is mainly dominated by political and financial motives, and impacts of land use and climate on the sediment transport dynamics are not adequately considered. Production of sediment budgets under different scenarios of land use and climate change should be an essential step when deciding the location and management strategies for dams. Selection of new hydroelectric reservoir sites must consider long-term scientific data on climate change, and the sediment budget components for sustainable land management planning, hydropower sustainability.