A water energy conversion system for convening the potential energy of water to electrical or mechanical energy, takes water at an inlet (105) from a higher elevation source, through a conduit (110) to a lower location. Then a riser (120) conveys the water up to nearly the same elevation it had at the inlet. The riser acts as a “virtual dam”, delivering the water with nearly the same head as a dam. The water from the riser is delivered to an energy converter (100) which comprises a loop raceway (130) which constrains and guides a plurality of carriage and disc assemblies (135) connected in a continuous train by links (155). An inlet (125) at the top of the energy converter receives the water where it falls downward through a jacket (140) that is constrained by the raceway (140).