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Willingness to pay for microgrids to enhance community resilience

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  • Hotaling, Chelsea
  • Bird, Stephen
  • Heintzelman, Martin D.

Abstract

Given the important role that electricity plays in powering society, and the significant risk that extreme weather and other events pose in disrupting electricity supply, the idea of community-scale microgrids has come to the forefront to enhance electrical grid resiliency and provide critical services to local communities during extended outages. In this paper, a discrete choice experiment is used to evaluate willingness to pay (WTP) for services provided by a community microgrid during extended power outages. With a sample of 939 respondents from New York State, results indicate that, overall, there is a positive willingness to pay for microgrid services, including hospital and emergency services, potable water, shelters, and retail outlets; even if residents are not receiving their own residential electricity supply during an outage. The average willingness to pay for the full suite of evaluated microgrid services is approximately $14 per month per household. We also find that WTP varies with some sociodemographic and other characteristics. These results provide critical evidence for rate-makers and utilities in evaluating societal benefit when making investment decisions for microgrids and related infrastructure.

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  • Hotaling, Chelsea & Bird, Stephen & Heintzelman, Martin D., 2021. "Willingness to pay for microgrids to enhance community resilience," Energy Policy, Elsevier, vol. 154(C).
    • Handle: RePEc:eee:enepol:v:154:y:2021:i:c:s0301421521001178
    DOI: 10.1016/j.enpol.2021.112248
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