As if any more fallout from California’s electricity crisiscould be found, a Colorado-based survey/consulting firm Tuesdayreleased summaries of a national client-supported study thatindicates large energy-using businesses are going to be willing topay more to prevent being shut down from electricity outages; andthe costs of those outages is skyrocketing.
Back in 1999 when Boulder, CO-based E-Source conducted itsinitial survey of large end-users the costs of the outages were”much greater than their willingness to pay for such outages,” saidBill LeBlanc, an E-Source vice president. “One of the things welearned as we spoke with end-users is they typically did not expectfuture outages even though history would tell them they were goingto have more of them. That is why I say California’s situation haschanged the psyche.
“It is very likely that these same customers now, once they havebeen sensitized to the situation, place more value on theirwillingness to pay to avoid these outages.”
In a study completed for about 35 utilities and a few largeindustrial customers around the country, E-Source examined poweroutages from the customer’s viewpoint, with the average respondentexperiencing about 17 outages over a 12-month period, most of themlasting only a few seconds, with financial services, continuousprocess and goods processing businesses reporting outage costs of$60,000 to $80,000 annually, LeBlanc said.
Extrapolating to the current experience of prolonged rollingblackouts or controlled voluntary interruptions of large businessesin California, LeBlanc said, “it’s easy to understand thedevastating impact these service interruptions are having onbusinesses (in California).
Nationwide, routine outages collectively are estimated to costthe retail sector of the economy about $1.25 billion annually, theE-Source study indicated. “Although it is difficult to determineactual figures on losses, we estimate that if all medium to largebusiness in California were without power for two hours each, theaccumulated losses could fall in the range of $500 to $750million,” LeBlanc said.
©Copyright 2001 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.
© 2023 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |