Hydroelectricity eliminates the flue gas emissions from fossil fuel combustion, including pollutants such as sulfur dioxide, nitric oxide, carbon monoxide, dust, and mercury in the coal. Hydroelectricity also avoids the hazards of coal mining and the indirect health effects of coal emissions. Compared to nuclear power, hydroelectricity generates no nuclear waste, has none of the dangers associated with uranium mining, nor nuclear leaks. Unlike uranium, hydroelectricity is also a renewable energy source.

Compared to wind farms, hydroelectricity power plants have a more predictable load factor. If the project has a storage reservoir, it can be dispatched to generate power when needed. Hydroelectric plants can be easily regulated to follow variations in power demand.

Unlike fossil-fueled combustion turbines, construction of a hydroelectric power plant requires a long lead-time for site studies, hydrological studies, and environmental impact assessment. Hydrological data up to 50 years or more is usually required to determine the best sites and operating regimes for a large hydroelectric plant. Unlike plants operated by fuel, such as fossil or nuclear energy, the number of sites that can be economically developed for hydroelectric production is limited; in many areas the most cost effective sites have already been exploited. New hydro sites tend to be far from population centers and require extensive transmission lines. Hydroelectric generation depends on rainfall in the watershed, and may be significantly reduced in years of low rainfall or snowmelt. Long-term energy yield may be affected by climate change. Utilities that primarily use hydroelectric power may spend additional capital to build extra capacity to ensure sufficient power is available in low water years.

In parts of Canada (the provinces of British Columbia, Manitoba, Ontario, Quebec, Newfoundland and Labrador) hydroelectricity is used so extensively that the word "hydro" is often used to refer to any electricity delivered by a power utility. The government-run power utilities in these provinces are called BC Hydro, Manitoba Hydro, Hydro One (formerly "Ontario Hydro"), Hydro-Québec and Newfoundland and Labrador Hydro respectively. Hydro-Québec is the world's largest hydroelectric generating company, with a total installed capacity (2007) of 35,647 MW, including 33,305 MW of hydroelectric generation.