Overview

Water Supply and Quality. Drought negatively impacts both the quantity and quality of water supplies. While a reduction in water supply is generally a temporary phenomenon, it can be permanent in some instances. Groundwater overdraft, for example, can cause land to sink, resulting in a permanent loss of groundwater storage. Drought can also compromise water quality, such as by concentrating salts and other contaminants, reducing dissolved oxygen levels, and increasing water temperatures. Water quality problems can exacerbate water supply problems.

Fish and Wildlife. During times of drought, political pressures often increase diversions of water away from ecosystems. As water levels in streams, rivers, and lakes decline, fish and wildlife are at risk of dying, potentially causing regional extinctions. Ecosystems under severe pressures due to water diversions, saltwater intrusion, and other stresses are especially vulnerable.

Energy. Drought can strain the energy system. The generation of hydroelectricity may drop dramatically as streamflow declines, increasing electricity prices as electricity production shifts to the more expensive fossil fuel (e.g., natural gas). Electricity generation from thermoelectric plants may also be curtailed if insufficient cooling water is available or if temperature limits in receiving waters are exceeded. Additionally, higher temperatures associated with drought reduce the efficiency of thermal power plants and of transmission and distribution lines while increasing energy demand for cooling and air-conditioning systems.

Agriculture. Some farmers and water districts with junior water rights may see water allocations from state and federal irrigation projects severely cut during a drought. Farmers facing a water shortage may seek temporary water transfers from other users, increase groundwater pumping, change the types of crops they grow, move towards drought-resilient irrigation, or leave some lands fallow.

Rural Communities. Rural communities are often dependent on a single water source, which increases vulnerability to water scarcity. Declining water supplies and water quality problems may force communities to switch to bottled water, dig deeper wells, and truck in water to refill holding tanks. These actions can impose local economic hardships on those living in rural areas, many of whom are among the most disadvantaged communities.

Urban Areas. Large urban areas are rarely at risk of running out of water. These areas often have multiple water sources, and their water needs are typically prioritized over other uses. During a drought, urban water utilities can implement a wide range of voluntary and mandatory water conservation programs. These include education programs, incentives to install water-efficient appliances and gardens, and restrictions on discretionary water uses, such as watering lawns.

Revenue Losses. For most water utilities, fixed costs (e.g., debt service on past water system investments) are relatively high and variable costs (e.g., energy and chemical costs) are relatively low. Reducing water use cuts variable costs but has no impact on fixed costs (at least in the short term). As water use declines, revenue from the sale of water also declines and may not be sufficient to recover the fixed costs. In response, water utilities may enact drought surcharges or draw from reserves. While surcharges increase the water rate (i.e., the price per gallon), those using less water may actually see their bills go down. Furthermore, conservation lessens the impact of the drought on water bills by avoiding the purchase of more expensive water supplies.