Grid hardening and the effectiveness of climate adaptation in the U.S. electricity sector

• In Event: Coordinating Grid Needs: Demand-Side Innovation Across Institutions, Customers, and Technologies

Abstract

A central question in climate economics is how well society can adapt to climate change. In this paper, I study the effectiveness of climate adaptation in a critical sector: the electricity system. Over the last decade, U.S. utilities have spent billions on “grid hardening,” in an effort to increase the reliability of the electricity grid during extreme weather events. However, the realized impact of hardening has yet to be documented empirically. Focusing on grid hardening efforts in Florida, which are meant to address high winds from hurricanes, I estimate a series of “response functions” that measure how likely a customer in Florida is to lose power on a given day when exposed to different wind speeds, relative to those in surrounding states. I further leverage two policy changes in Florida to identify the separate effects of different “levels” of grid hardening. My preliminary findings suggest that grid hardening does improve reliability: on a given day, a county in Florida is 3% less likely to experience a power outage; there are 0.29% fewer customers without power; and outages are 3.17 minutes shorter, on average. I also find that investment in physical infrastructure, such a steel poles or undergrounding wires, appears to have a larger benefit on reliability at the highest levels of wind exposure, relative to operational changes, such as vegetation clearing. The final paper will analyze the return on utility investment in hardening for ratepayers within a cost-benefit framework.

Author

• Madeline Yozwiak, Carnegie Mellon University
  Presenting Author