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Abstract

  • Our results suggest that consumers would transfer some of the inherent risks of a blackout to the utility for a price lower than their willingness to pay to achieve their desired level of protection, creating economic value.
  • The purchase of insurance would help most consumers avoid a complete loss of power. Our simulations show that of those households that would otherwise experience a complete loss of power, on average between 1% and 15% can fully cover their excess energy needs through insurance. Between 50% and 70% of these households are budget constrained but would still be able to partially cover their excess energy needs.

Authors

Rolando Fuentes

Rolando Fuentes

Dr. Rolando Fuentes was a research fellow focusing on business and regulatory models for the Utilities of the Future project.… Dr. Rolando Fuentes was a research fellow focusing on business and regulatory models for the Utilities of the Future project. He has extensive experience in the energy and environmental sectors as an academic and policymaker. Rolando was the director of international negotiations at the Mexican Ministry of Energy and later became director of hydrocarbons projects. Before joining the Mexican government, he was a fellow of the London School of Economics, where he lectured and taught courses in Environmental Impact Assessment and Environmental Policy, and supervised master’s dissertations. Rolando has also been an associate of the Oxford Institute of Energy Studies and IHS Cambridge Energy Research Associates (IHS CERA), and was a recipient of the British Chevenning Scholarship in 2001.  

AS

Abhijit Sengupta

Abhijit Sengupta is a Senior Lecturer in Innovation and Entrepreneurship at the University of Kent’s Business School. He holds a Ph.D.… Abhijit Sengupta is a Senior Lecturer in Innovation and Entrepreneurship at the University of Kent’s Business School. He holds a Ph.D. in Economics from Stony Brook University in New York, an M.A. in Economics from Jawaharlal Nehru University, India and a B.Sc. in Economics from the University of Calcutta, India. He has published in top tier journals including Research Policy,  British Journal of Management, Journal of Economic Dynamics and Control, and Advances in Complex Systems.

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