Advantages

The upper reservoir and dam of the Ffestiniog pumped storage scheme. 360 megawatts of electricity can be generated within 60 seconds of the need arising.

Economics

The major advantage of hydroelectricity is elimination of the cost of fuel. The cost of operating a hydroelectric plant is nearly immune to increases in the cost of fossil fuels such as oil, natural gas or coal, and no imports are needed.

Hydroelectric plants also tend to have longer economic lives than fuel-fired generation, with some plants now in service which were built 50 to 100 years ago. Operating labor cost is also usually low, as plants are automated and have few personnel on site during normal operation.

Where a dam serves multiple purposes, a hydroelectric plant may be added with relatively low construction cost, providing a useful revenue stream to offset the costs of dam operation. It has been calculated that the sale of electricity from the Three Gorges Dam will cover the construction costs after 5 to 8 years of full generation.

Greenhouse gas emissions

Since hydroelectric dams do not burn fossil fuels, they do not directly produce carbon dioxide (a greenhouse gas). While some carbon dioxide is produced during manufacture and construction of the project, this is a tiny fraction of the operating emissions of equivalent fossil-fuel electricity generation.

Related activities

Reservoirs created by hydroelectric schemes often provide facilities for water sports, and become tourist attractions in themselves. In some countries, aquaculture in reservoirs is common. Multi-use dams installed for irrigation support agriculture with a relatively constant water supply. Large hydro dams can control floods, which would otherwise affect people living downstream of the project.