The spatial mismatch between energy resources and water resources has been widely concerned. Electricity trade drives virtual water flows from electricity production sides to consumption sides, which can aggravate or alleviate regional water scarcity. Investigating the historical evolution of virtual water transmission and its impacts on water scarcity benefits the sustainable development of energy and water. To reduce data uncertainties, in this study, we built provincial water intensity of electricity generation inventory considering the impacts of factors such as electricity generation types, cooling technologies and generator units. Besides, to investigate how the direction and quantity of virtual water flows aggravate or alleviate the regional water scarcity, the impact assessment model was built, and the impact assessment index was defined. The results showed that the water consumption of electricity generation and interprovincial virtual water transfer increased by 2.61 times and 5.12 times during 2005–2015, respectively. Changes in the amount of electricity generation and the electricity transmission structure were the two main drivers of increases in virtual water flows, contributing to a total increase of 85.28%. A large amount of virtual water was transferred from the southwest and the northwest to the eastern coastal areas. There were many “positive flows” from the southwest to Jiangsu-Zhejiang-Shanghai, while “negative flows” were concentrated in Xinjiang-Henan, Gansu-Qinghai and Gan-Shaanxi. The nodes with the largest impact assessment index value were Hubei, Sichuan and Shanghai, while the lowest were Gansu, Xinjiang and Qinghai. This study can provide a basis for optimizing the electricity generation mix and electricity transmission structure, alleviating the growing tension between energy and water, and realizing the sustainable development of water resources.