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Power system reliability is sensitive to climate-driven variations in both energy demand and water availability, yet the combined effect of these impacts is rarely evaluated. Here we show that combined climate change impacts on loads and hydropower generation may have a transformative effect on the nature and seasonality of power shortfall risk in the U.S. Pacific Northwest. Under climate change, potential shortfall events occur more readily, but are significantly less severe in nature. A seasonal reversal in shortfall risk occurs: winter shortfalls are eradicated due to reduced building heating demands, while summer shortfalls multiply as increased peak loads for day-time cooling coincide with impaired hydropower generation. Many of these summer shortfalls go unregistered when climate change impacts on loads and hydropower dispatch are analyzed in isolation-highlighting an important role of compound events.