This is addressed in the "Renewable Energy - Without the Hot Air" Report

http://www.inference.phy.cam.ac.uk/withouthotair/c26/page_18...

basically the author says that what you describe is the best option right now but there are only so many places you can put those facilities because they require very specific geography.

That being said building lakes and dams is really bad for the river eco system and really expensive to buy land out from under people to flood it.