Except excess hydroelectric production is extremely valuable to other utilities on the interconnection who run primarily thermal plants.
Hydro is one of the few forms of baseload power that can be ramped in a hurry: you can increase or decrease production just by increasing or reducing flow through the turbine. If you use less water, it builds up in the reservoir as potential energy and you can use it later.
Compare this to thermal plants, which require many hours to have a significant swing in energy output. I have heard of ramp figures on the order of days for very large nuclear reactors.
Because thermal stations run with pretty flat power output, hydroelectric stations have a critical role smoothing out load conditions, ramping down at night and up during the day. Since electricity is traded on a market system, utilities with significant hydro operations really benefit from this: they can reduce production and import excess capacity from thermal plants at night, and increase production during the day to export at a much higher rate.
This is part of why regions with predominantly hydro power have such low rates: in addition to hydroelectric being pretty cheap once a dam is built, hydro operators make significant amounts of money by appropriate import/export to thermal operators. Since a lot of hydro utilities are state owned (eg: BC Hydro, Hydro Quebec, Bonneville Power Administration), the profits are used to subsidize lower rates for ratepayers.