Impact analysis of electricity supply unreliability to interdependent economic sectors by an economic-technical approach

This paper proposes a novel framework to quantify the economic impact of electricity supply interruptions to other economic sectors considering their interdependency and increasing penetration of wind power. It is achieved by a novel integrated model that combines economic interdependency and electricity supply reliability. Leontief Input-Output model is used to determine the dependency of other economic sectors on electricity supply and electricity reliability theory is utilised to quantify electricity supply interruptions. The two models are combined to quantify two key indexes: the inoperability of different economic sectors and their losses under electricity supply unreliability. Further, an optimal model is designed to allocate available electricity to minimise the economic losses of these sectors when electricity supply is interrupted. Two UK electricity generation scenarios are used to demonstrate the concept. It is found that economic sectors have various degrees of dependency on electricity supply and their losses also differ significantly. In addition, more wind power penetration could jeopardize electricity supply adequacy and consequences to other sectors. The findings can assist policy makers to understand the importance of electricity security to other sectors and quantify potential economic losses so that new policies and regulations can be designed to mitigate the adverse consequences, such as developing the capacity market.