The Italian government declared a state of emergency in five northern regions because of a dangerous heatwave and drought -- that are taking a toll on agriculture and threatening power supplies, according to Reuters. 

The emergency was declared on Monday and will remain in effect until the end of the year and give local authorities the tools to take immediate action, such as imposing water rationing on homes and businesses.

So far, 36.5 million euros ($38.1 million) have been earmarked for northern regions, such as Emilia-Romagna, Friuli Venezia Giulia, Lombardy, Piedmont, and Veneto, to tackle the water shortage.

"The state of emergency is aimed at managing the current situation with extraordinary means and powers, with relief and assistance to the affected population," the government said.

Bloomberg's two-week max temperature forecasts show the heatwave could worsen. 

High temperatures and arid conditions have brought the water levels of Po, Italy's longest river, which runs for more than 650 km (400 miles) through the northern region, to lows not seen in seven decades. Po provides critical water supplies to vast amounts of farmland -- the drought threatens about 30% of Italy's agricultural produce and could lead to seasonal harvest declines for barley, grain, and rice. 

The extreme conditions have led to a 50% decline in hydroelectric power, which feeds about 15% of the country's power needs. Less hydroelectric power will strain the grid and put more pressure on fossil fuel power generation amid an ongoing energy crisis.