The shutdown of California’s 644 MW Edward Hyatt hydroelectric power plant because of insufficient water levels at the Oroville Dam reservoir is squeezing an already tight power market in the western United States, according to Moody’s Investors Services.

California hydropower

On Aug. 5, the California Department of Water Resources took the plant offline. This has contributed to higher power prices in the region and is fueling concerns about electricity reliability, Moody’s analysts said in a report.

Almost 88% of the western United States is facing severe to exceptional drought conditions, according to the U.S. Drought Monitor. 

Through the first five months of 2021, hydropower generation in California was only 37% of the prior five-year average for the same period. It also fell to its...