In order to effectively utilize hydro production flexibility, a sufficient amount of transmission capacity has to be available between the hydro-dominated part of the system and the part that requires operational flexibility. This chapter starts with a rough categorization of “base” hydropower flexibility, investigating the types of hydropower plants installed in power systems today. The “effective” hydropower flexibility available to support the integration of variable generation is a far more complex and case-specific aspect. It is discussed through national experiences. The chapter presents potential developments that would increase the participation of hydropower and discuss the ensuing challenges. Modeling a flow-based hydro system is a complex exercise, as is modeling the power system. Especially important is the correct assessment of hydropower flexibility to support power systems with a large share of variable generation (VG) and its value for storage. With increasing uncertainty and variability, a stochastic scheduling approach should yield lower costs.