  In the upcoming era of high-precision galaxy surveys, it becomes necessary to
understand the impact of redshift uncertainties on cosmological observables. In
this paper we explore the effect of sub-percent photometric redshift errors
(photo-$z$ errors) on galaxy clustering and baryonic acoustic oscillations
(BAO). Using analytic expressions and results from $1\,000$ $N$-body
simulations, we show how photo-$z$ errors modify the amplitude of moments of
the 2D power spectrum, their variances, the amplitude of BAO, and the
cosmological information in them. We find that: a) photo-$z$ errors suppress
the clustering on small scales, increasing the relative importance of shot
noise, and thus reducing the interval of scales available for BAO analyses; b)
photo-$z$ errors decrease the smearing of BAO due to non-linear redshift-space
distortions (RSD) by giving less weight to line-of-sight modes; and c)
photo-$z$ errors (and small-scale RSD) induce a scale dependence on the
information encoded in the BAO scale, and that reduces the constraining power
on the Hubble parameter. Using these findings, we propose a template that
extracts unbiased cosmological information from samples with photo-$z$ errors
with respect to cases without them. Finally, we provide analytic expressions to
forecast the precision in measuring the BAO scale, showing that
spectro-photometric surveys will measure the expansion history of the Universe
with a precision competitive to that of spectroscopic surveys.
