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Small hydropower plants (SHPs) are rapidly sprawling, both globally and across the Amazon's free flowing rivers, threatening provision of ecosystem services, river connectivity, biodiversity conservation, and the livelihoods of indigenous and traditional communities. In Brazil, cumulative impacts of SHPs have been largely neglected in planning and policy instruments. In this perspective article, we highlight current policy challenges and options for assessing the impacts of small hydroelectric plants in the Amazon, which deserve more attention in both academic research and public policies. We review environmental licensing of seven small and one large dam in the Cupari river, a Tapajos tributary, which is being challenged in Federal Courts based on inadequate cumulative impact assessment. We argue for the need of adopting good practices in cross-scale environmental assessment when applying existing or new policy instruments, including: the adoption of Strategic Environmental Assessment in planning for hydropower expansion taking into consideration other plans, programs and policies at regional and Amazon-wide scales; developing integrated environmental assessments considering inventoried SHPs and large hydropower plants; using scientific evidence and technological tools in planning and siting of SHPs; complying with policies that protect human and environmental rights; and strengthening intersectoral dialogue and multi-stakeholder forums and committees.