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Warm Winter Drags U.S. Natural Gas Prices to Three-Decade Low

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California Drought Expected to Lower Hydro Generation

The record drought in California will cut into the availability of water for hydropower generation in the coming months, according to the Energy Information Administration. Nearly 60% of the state of California is classified to be in a condition of extreme-drought, after the driest December ever. In fact, the drought is California’s worst on record, and there is evidence that it may be the worst drought in the last 500 years. The Governor of California declared a state of emergency, and there are at least 17 rural California communities that are in danger of running out of water within the next two to four months.

Drought is posing a serious challenge to the state, not just for drinking needs and agriculture, but also for electricity generation. Much of California gets its precipitation in winter months, and as melting snowpack in spring and summer slowly releases water, it is used to generate electricity at hydropower stations. However, the snowpack in the Sierra Nevada Mountains are at only 12% of their normal levels. Unless the state gets rain, the problem will only grow worse as electricity demand rises with warmer weather. At the same time, rain becomes less likely in the summer months, and without having collected water during what is supposed to be the wet months, the drought could reach a real crisis point this summer.

Related article: Argentina: Hydropower Plans and EU Bio-Diesel Duties

This also means that California’s hydro generation in the coming months will be lower than usual. The share of electricity from hydro varies from year to year in California, but it ranges from 11%-28% of the state’s total. A dry year will require California to import electricity from neighboring states. Much of that imported power will also come in the form of hydrogenation, but from the Pacific Northwest. The problem is that, according to EIA, Oregon and Washington are also experiencing lower levels of precipitation.

By. Charles Kennedy of Oilprice.com



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