The paper addresses the challenges of short-term hydropower scheduling in a liberalized power system. Hydropower systems may have quite complex topologies with many cascaded reservoirs/power plants in the same river system. The reservoirs may have very different storage capacity with significant water travel time that makes the decisions coupled between several time steps. In other words, the decisions in one time interval have strong impact on what's possible to do in later time steps. In systems where some of the reservoirs have significant storage capacity, the use of the hydropower resources short-term will be coupled with the long-term strategic decisions. It is not feasible to have the short-term decisions within the same model as the long-term decisions because modeling of uncertainty is important. The problem is decomposed into a planning hierarchy where the long/mid-term models provide …