The dam wall was constructed in 1952 with the idea of providing hydro-electric power to the rest of France, although the French eventually decided to use nuclear power instead. I think the power generated at the dam is only used locally. There is supposed to be a huge painting of Hercules, the biggest painting in the world, on the dam wall - but I couldn't see it when I was there (maybe I was ski-ing too fast for a proper look!).
The original village of Tignes is now under the water of the Lac du Chevril, and apparently the inhabitants used the compensation money to build the first ski lifts. The village was moved up to what is now Tignes Le Lac, at 2,100m. There are 5 Tignes villages.
Apparently every 10 years the dam gates are opened to drain the lake and clean it out. And I was told, when I was there, that they conduct a service for the original inhabitants in the old church. The old village is still there, but normally out of sight, under the water. I have seen the replica of the old, submerged, church which they built at Tignes Les Boisses.
Tignes les Brevieres (where the chalet is), at 1,550m is the only old original village left in the Tignes area, and still has its 13th Century church. Tignes Les Boisses, the next closest village at 1,800m is built above the dam. Val Claret (where the funicular starts on its way up to the Grande Motte glacier, at 3,656m), Tignes Le Lac, and Le Lavachet are all very close to each other at 2,100m.
The Tignes ski area has around 150 Km of piste, and it's very well linked to Val d'Isere which has around another 150 Km of piste. The 2 areas together are known as the Espace Killy.