Embolisms decrease plant hydraulic conductance and therefore reduce the ability of the xylem to transport water to leaves provided that embolized conduits are not refilled. However, as a xylem conduit is filled with gas during cavitation, water is freed to the transpiration stream and this transiently increases xylem water potential. This capacitive effect of embolism formation on plant function has not been explicitly quantified in the past. A dynamic model is presented that models xylem water potential, xylem sap flow and cavitation, taking into account both the decreasing hydraulic conductance and the water release effect of xylem embolism. The significance of the capacitive effect increases in relation to the decreasing hydraulic conductance effect when transpiration rate is low in relation to the total amount of water in xylem conduits. This ratio is typically large in large trees and during drought.