They will produce power for sale. Because their variable costs are virtually zero.
Nobody can beat it.
It would be transparently wasteful for other generating resources to be up and running while lower cost hydro turbines stand idle. It is better for the Treasury to lose a little money than a lot of money. But, so long as variable costs are covered and some contribution, even tiny, made toward fixed costs, owners of the hydro system are at least minimizing losses. Like land, there is no more to be had at any price. That would be mindless, leading to the equivalent of an overgrazed commons or what is the same, long queues of unsatisfied demand.