Market-based Estimation of Average Electricity Outage Costs in the United States

Chi Keung Woo, A. Tishler, Kang Hua Cao, Han Qi*, Raymond Li, Jay Zarnikau

*Corresponding author for this work

Research output: Contribution to journalJournal articlepeer-review


Electricity outage cost (EOC) estimates ($ per kWh unserved) are essential input data for optimal reliability planning and efficient pricing of electricity services. Based on the 2019-2020 market data published by two US government agencies for the lower 48 states, this paper’s EOC estimates by census region and year are median values of $1.39 to $2.93 per kWh unserved, well below the estimate of $9 per kWh unserved adopted by Texas for optimal reliability planning. The policy implications of adopting our lower EOC estimate are (a) a reduction in an electric grid’s optimal planning reserve to improve the grid’s cost efficiency; and (b) a decline in the grid’s marginal cost-based retail price to encourage welfare-enhancing end-use consumption.

Original languageEnglish
Pages (from-to)1-5
Number of pages5
JournalEnergy Research Letters
Issue number2
Publication statusPublished - 10 May 2024

Scopus Subject Areas

  • Energy (miscellaneous)

User-Defined Keywords

  • Electricity outage costs
  • Market-based estimation
  • United States


Dive into the research topics of 'Market-based Estimation of Average Electricity Outage Costs in the United States'. Together they form a unique fingerprint.

Cite this