I may not fully understand your question.  I am assuming a hydropower dam is affecting the function of a natural freshwater wetland, perhaps by its hydropower cycles of raising and lowering water so frequently.  In our country, we would try to identify this circumstance before building the project and then require the hydro power company to provide suitable mitigation.  If the location of the wetland is just in the hydropower flood margins, perhaps providing a small berm of fill material, like a dike, might be considered.  Dikes can be retrofitted to release water from natural wetland overflow, but prevent influx of water from the hydropower dam filling.  I don't know how deep for a dike is practical, perhaps 5 to 10 feet maybe, depending on the materials and contruction.  But typically if a dam or hydropower structure is approved and installed that floods or impacts areas, those areas being impacted are more or less written off or mitigated in some way, such as providing a suitable wetland replacement such as preferring restoration of a formerly affected wetland that had been drained rather than creating a wetland, which is more difficult to do.  If the wetland was habitat for an endangered species, it may have prevented the hydropower installation unless a solution was found to resolve the issue.  One other possibility is to see if the company would be willing to sacrifice some storage, that is to require the release of water for hydropower or force spillage of water before the dam fills to the level it is affecting the wetland.  This may not be reasonable.  If the wetland habitat were critical and important, they might consider other options if it does not drastically alter their overall operation and viability, just the frequency when they must pass flow.  Some wetland habitats are damaged if they are flooded and fish can come in and consume wetland organisms of special concern, such as salamanders, frogs, etc.  Flooding may also cause vegetation change as the wetland hydroperiod adjusts to new water regime, so if there are rare plant habitats, can they stand the more frequent flooding?  There is a good possibility that wetland flooding will change the function and species of the wetland, but might it still provide some wetland function or values, or just end up being a fishing pond or wildlife watering hole if there is access to it.  Your specific circumstance will probably dictate which way to go.  Some wetlands are especially unique, others have nothing that special.  If given the choice with no ramifications, solution 1 is best, 2 is a compromise, and 3 is often the real world solution -- so in that case especially, seek mitigation and restore a damaged wetland with similar potential, and if there are critical species, consult suitable specialists about relocating rare plants and animals and hope for the best.

Dear William F.Hansen,

Your assumption is true that hydro power dam is affecting the function of a natural fresh water wetland since the   last three decades, Loktak Ramsar in the remote north east India, Manipur. No EIA( Environment Impact Assessment) had been done so far. Scenario no.3 will be doomsday for endangered species like Rucervus eldii eldii, Hog deer and thousands of migratory waterbirds, plants etc. As a result and impact  of the hydro power, indigenous fishes could not be seen anymore.