The tin oxide buffer layer between the transparent conducting oxide current collector and the hematite photoelectrode causes considerable water oxidation enhancement of that electrode. The water oxidation onset potential is lowered by 180 mV. The lifetime of photogenerated charge carriers is increased by a factor of 10. For the investigation of structure and function of the buffer layer, we designed a wedge-shaped multilayer film assembly. Oxygen 1s X-ray photoemission spectra suggest a decrease of oxygen vacancy concentration near the interface of alpha-Fe2O3 and FTO-SnO2, when the SnO2 buffer layer is introduced. This SnO2 buffer layer increases the crystallinity of the hematite layer. The oxygen 1s near-edge X-ray absorption fine structure shows that the buffer layer increases the Fe 3d-O 2p hybridization and affects the quasi-Fermi level of electrons in alpha-Fe2O3. There is some indication that the alpha-Fe2O3 layer contains an adverse hole state in the valence band which disappears when the alpha-Fe2O3 layer is grown on the SnO2 layer. This layer induces improved orbital overlap with subsequent improved charge transfer between the absorber alpha-Fe2O3 and the current collector FTO. Our experiments indicate that performance enhancement by this buffer layer is of electronic structure origin.