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Estimating what US residential customers are willing to pay for resilience to large electricity outages of long duration

Author

Listed:
  • Sunhee Baik

    (Carnegie Mellon University)

  • Alexander L. Davis

    (Carnegie Mellon University)

  • Jun Woo Park

    (Carnegie Mellon University)

  • Selin Sirinterlikci

    (General Motors)

  • M. Granger Morgan

    (Carnegie Mellon University)

Abstract

Climate-induced extreme weather events, as well as other natural and human-caused disasters, have the potential to increase the duration and frequency of large power outages. Resilience, in the form of supplying a small amount of power to homes and communities, can mitigate outage consequences by sustaining critical electricity-dependent services. Public decisions about investing in resilience depend, in part, on how much residential customers value those critical services. Here we develop a method to estimate residential willingness-to-pay for back-up electricity services in the event of a large 10-day blackout during very cold winter weather, and then survey a sample of 483 residential customers across northeast USA using that method. Respondents were willing to pay US$1.7–2.3 kWh–1 to sustain private demands and US$19–29 day–1 to support their communities. Previous experience with long-duration outages and the framing of the cause of the outage (natural or human-caused) did not affect willingness-to-pay.

Suggested Citation

  • Sunhee Baik & Alexander L. Davis & Jun Woo Park & Selin Sirinterlikci & M. Granger Morgan, 2020. "Estimating what US residential customers are willing to pay for resilience to large electricity outages of long duration," Nature Energy, Nature, vol. 5(3), pages 250-258, March.
    • Handle: RePEc:nat:natene:v:5:y:2020:i:3:d:10.1038_s41560-020-0581-1
    DOI: 10.1038/s41560-020-0581-1
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    Citations

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    Cited by:

    1. Mehrnoosh Asadi & James I. Price & Roselinde Kessels & Pallab Mozumder, 2024. "Hurricane-Induced Power Disruptions: Household Preferences for Improving Infrastructure Resilience," Economics of Disasters and Climate Change, Springer, vol. 8(2), pages 235-261, July.
    2. Zhang, Chonghui & Wang, Zhen & Su, Weihua & Dalia, Streimikiene, 2024. "Differentiated power rationing or seasonal power price? Optimal power allocation solution for Chinese industrial enterprises based on the CSW-DEA model," Applied Energy, Elsevier, vol. 353(PB).
    3. Gurupraanesh Raman & Yang Yang & Jimmy Chih-Hsien Peng, 2024. "The social factors shaping community microgrid operation," Nature Communications, Nature, vol. 15(1), pages 1-8, December.
    4. Daniel Thompson & Gianluca Pescaroli, 2024. "Financing electricity resilience in local communities: a review of the literature," Environment Systems and Decisions, Springer, vol. 44(3), pages 740-762, September.
    5. Kazmi, Hussain & Mehmood, Fahad & Shah, Maryam, 2024. "Quantifying residential energy flexibility potential for demand response programs using observational data from grid outages: Evidence from Pakistan," Energy Policy, Elsevier, vol. 188(C).
    6. Gorman, Will & Barbose, Galen & Pablo Carvallo, Juan & Baik, Sunhee & Miller, Chandler & White, Philip & Praprost, Marlena, 2023. "County-level assessment of behind-the-meter solar and storage to mitigate long duration power interruptions for residential customers," Applied Energy, Elsevier, vol. 342(C).
    7. Xu, Jiuping & Tian, Yalou & Wang, Fengjuan & Yang, Guocan & Zhao, Chuandang, 2024. "Resilience-economy-environment equilibrium based configuration interaction approach towards distributed energy system in energy intensive industry parks," Renewable and Sustainable Energy Reviews, Elsevier, vol. 191(C).
    8. Jamil, Faisal & Islam, Tanweer Ul, 2023. "Outage-induced power backup choice in Pakistan," Utilities Policy, Elsevier, vol. 82(C).
    9. Jin, Taeyoung & Lee, Tae Eui & Kim, Dowon, 2024. "Valuing flexible resources in the Korean electricity market based on stated preference methods," Utilities Policy, Elsevier, vol. 88(C).
    10. Kuang, Biao & Shi, Yangming & Hu, Yuqing & Zeng, Zhaoyun & Chen, Jianli, 2024. "Household energy resilience in extreme weather events: An investigation of energy service importance, HVAC usage behaviors, and willingness to pay," Applied Energy, Elsevier, vol. 363(C).
    11. Ziyi Wang & Zengqiao Chen & Cuiping Ma & Ronald Wennersten & Qie Sun, 2022. "Nationwide Evaluation of Urban Energy System Resilience in China Using a Comprehensive Index Method," Sustainability, MDPI, vol. 14(4), pages 1-36, February.
    12. Lambert, Dayton M. & Ripberger, Joseph T. & Jenkins-Smith, Hank & Silva, Carol L. & Bowman, Warigia & Long, Michael A. & Gupta, Kuhika & Fox, Andrew, 2024. "Consumer willingness-to-pay for a resilient electrical grid," Energy Economics, Elsevier, vol. 131(C).

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