I know dams can mess up habitats, cutting fish and eels off from their full range or from their spawn points. But I’m also a big fan of using energy in the form we receive it (use solar light/heat for machining with focusing mirrors and lenses, use kinetic energy from windmills or water wheels to drive tools industrial revolution style, skip the lossy conversion into electricity and back again. I’ve got a workshop design in mind, what can I do to make a water wheel more okay?
The small amount flowing/dropping fast seems great if it fits the site (and what do you know, I’m drawing the site so it will!) and electricity production probably makes the most sense. Power tools are incredibly useful and quite plentiful as-is. I’ll admit the mechanical transmission to the big standup tools idea is partly an attempt to find ways to avoid needing batteries, as I see them as a limiting factor and eventual waste, but as this is a static location, the people using it can certainly afford to build a bunch of simple, less efficient ones using less-environmentally-damaging materials, so that would be less of a concern. The other aspect was that old tools would lend themselves to it really well - most of my benchtop or standup power tools are old enough that the motor is just bolted on to the outside, so powering it with a mill would be almost as simple as running a belt to the new source of motion (granted, I’d want to install mechanical cutoffs between the main belt and the tool so the machines can be disconnected quickly in case of an accident.