California Governor Arnold Schwarzenegger is expected to pursue at least one new hydro project over the coming year as part of a programme to tackle climate change.
Two dams proposed near Sacramento and Fresno would require a combined investment of US$3.7B, US media reports.
The Sites reservoir project would be about 100km northwest of Sacramento and would be filled by running a 25km pipeline from the Sacramento river.
The Temperance Flat project would stretch a dam across the San Joaquin river, just above Millerton Lake outside Fresno.
The proposals may be outlined in the forthcoming State of the State address from the governor. The US state has not constructed a large reservoir since 1974.