Agree completly, The tunnel is not different to a smallish stream - We may see it as carrying a lot of water but in power generation terms its next to nothing. To raise the head pressure it could be 'dammed' to flood the mine workings, raising the water table, refilling the natural caves in the area etc but this would not result in more volumetric flow - so the actual generating capacity would still be minimal. Also by flooding the system they would risk damaging the stuctural integrity of the tunnel itself and would struggle to maintain it.
If anything it would be better suited as a cyclic generation system. i.e. during times of low load the 'dam' could be closed in, raising the pressure as the system flooded, and then releasing it for a short period, high volume flow to generate power at times of peak demand.
However, ultimately i would suggest that the investment required to install, maintain and operate wouldn't pay back a profit and hence i don't think we've got anything to worry about.
An annoyingly stupid newspaper article written by people who don't have a clue, about an idea suggested by someone who is obviously a complete idiot. Typical of 99% of the bloody media :-/