California drought cuts into state’s hydro power supplies

California’s drought could dry up the state’s supply of hydroelectricity, prompting utilities to switch to more expensive gas-fired plants.

While utilities don’t anticipate shortages when summer’s peak electricity demand arrives, customers could eventually end up paying more.

That’s because gas-fired electricity costs about three times more than hydro power, according to federal energy officials.

Andrew Kotch, a spokesman for the Public Utilities Commission, tells the Sacramento Bee newspaper “a fairly minor impact” on rates is most likely for the state’s rate-regulated utilities. He says any rate increase because of the drought would take effect in 2015.

Water accounts for about 15 percent of California’s total power supply in a normal year.

Sacramento Municipal Utility District says it has a rate-stabilization fund that can be used to buy power during a drought to keep prices down.