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Electricity Supply Interruptions: Sectoral Interdependencies and the Cost of Energy Not Served for the Scottish Economy

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  • Rahmatallah Poudineh
  • Tooraj Jamasb

Abstract

Modern economies and infrastructure sectors rely upon secure electricity supplies. Due to sectoral interdependencies, major interruptions cause cascading effects in the economy. This paper investigates the economic effects of major power supply disruptions taking such interdependencies into account. We apply a dynamic inoperability input-output model (DIIM) to 101 sectors, including households, of the Scottish economy in 2009 to explore the direct, indirect, and induced effects of supply interruptions. We estimate the societal cost of energy not supplied (SCENS) due to an interruption. The results show that the most economically affected industries, following an outage, are different from the most inoperable ones. The results also indicate that SCENS varies with the duration of a power cut, ranging from ਴,300/MWh for a one-minute outage to \xA38,100/MWh for a three-hour (and higher) interruption. The results can be used to design policies for contingencies and preventive investments in the power sector.

Suggested Citation

  • Rahmatallah Poudineh & Tooraj Jamasb, 2017. "Electricity Supply Interruptions: Sectoral Interdependencies and the Cost of Energy Not Served for the Scottish Economy," The Energy Journal, , vol. 38(1), pages 51-76, January.
    • Handle: RePEc:sae:enejou:v:38:y:2017:i:1:p:51-76
    DOI: 10.5547/01956574.38.1.rpou
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    References listed on IDEAS

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    1. Kjølle, G.H. & Utne, I.B. & Gjerde, O., 2012. "Risk analysis of critical infrastructures emphasizing electricity supply and interdependencies," Reliability Engineering and System Safety, Elsevier, vol. 105(C), pages 80-89.
    2. Burkett, John P., 2006. "Microeconomics: Optimization, Experiments, and Behavior," OUP Catalogue, Oxford University Press, number 9780195189629.
    3. Gerd Kjølle & Oddbjørn Gjerde, 2012. "Risk Analysis of Electricity Supply," Springer Series in Reliability Engineering, in: Per Hokstad & Ingrid B. Utne & Jørn Vatn (ed.), Risk and Interdependencies in Critical Infrastructures, edition 127, chapter 0, pages 95-108, Springer.
    4. Reichl, Johannes & Schmidthaler, Michael & Schneider, Friedrich, 2013. "The value of supply security: The costs of power outages to Austrian households, firms and the public sector," Energy Economics, Elsevier, vol. 36(C), pages 256-261.
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    Cited by:

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    2. He, Xiaoping & Jiang, Shuo & Yu, Yuxuan & Su, Siyi, 2025. "Impact of novel infrastructure investments on productivity: Evidence from public procurement of EV charging facilities in China," Energy, Elsevier, vol. 334(C).
    3. Xiangpeng Li & Junwei Ma & Bo Li & Ali Mostafavi, 2025. "Quantifying the Social Costs of Power Outages and Restoration Disparities Across Four U.S. Hurricanes," Papers 2509.02653, arXiv.org, revised Sep 2025.

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