Pine forest near Los Alamos NM, in 2002 on the left and in 2004 on the right, showing the changes in vegetation, with large amounts dead, due to drought.
Scientists writing in Nature Geoscience have made a rather grim forecast for the coming century: The chronic drought conditions that hit the western US from 2000-2004, the strongest in 800 years, will become normal conditions.
Report co-author Beverly Law:
Areas that are already dry in the West are expected to get drier. We expect more extremes. And it's these extreme periods that can really cause ecosystem damage, lead to climate-induced mortality of forests, and may cause some areas to convert from forest into shrublands or grasslands. (Science Daily)
In addition to the perhaps obvious effects of extreme drought on water availability and changing vegetation, it also has a serious impact on carbon sequestration. The drought of 2000-2004 reduce carbon storage by an average of 51% across the western US, Canada, and Mexico, as withering vegetation released CO2 into the atmosphere and was also unable to store carbon as it would if it were healthy.
Normally, the vegetation of North America is able to absorb about 30% of the carbon emitted across the region.