United States Electric Utility Adaptation to Natural Hazards and Green Power Mandates

Abstract

Access to electricity is a crucial determinant of quality of life and productivity. The United States has a highly reliable electricity grid, but it faces new resilience challenges due to more intense disasters and ambitious green power requirements. Over the past decade, utilities have faced tradeoffs between achieving carbon mitigation goals, offering reliable power access, and keeping retail prices low. Using a generator panel dataset from 2013 to 2022, we document that electricity generation from renewables declines during extreme weather events. Based on an electric utility panel dataset over the same period, we find that disasters also disrupt electricity distribution. Although utilities have made some adaptation progress, investments in green and reliable green power are associated with higher electricity prices.