To summarize, the construction of these dams requires the release of lots of CO2, and the reservoirs that these dams require provide a perfect place for vegetation to decompose anaerobically in to methane instead of CO2, which is problematic because while decomposed CO2 can be fixed again as part of the natural carbon cycle, methane can't. (This is my understanding, at least.) The results can be dramatic:
In a study to be published in Mitigation and Adaptation Strategies for Global Change, Fearnside estimates that in 1990 the greenhouse effect of emissions from the Curuá-Una dam in Pará, Brazil, was more than three-and-a-half times what would have been produced by generating the same amount of electricity from oil. [emphasis mine]
Jesus. This changes the landscape quite a bit. I had always assumed that we would keep hydro around as a foundation for what solar and wind couldn't meet. That might not be the case. Three and a half times! Damn.