From: Energy Bad Boys - Substack

By: Energy Bad Boys and Mitch Rolling

Date: April 18, 2026

 

The Price of Darkness: A First Look at Blackout Economics

 

 

We are currently working on an exciting new project called the Social Cost of Blackouts.

In this upcoming report, we argue that regulatory agencies like the Environmental Protection Agency (EPA) and utility regulators should be required to determine whether proposed power plant regulations or integrated resource plans (IRPs) will result in blackouts based on hourly reliability assessments using historical weather patterns, and to calculate the economic damages from those outages.

Importantly, our analysis offers guidance on how to do that, providing a process for modeling the reliability of proposed regulations or resource plans and calculating the cost of blackouts. The report should be out around June.

 

Why Develop the Social Cost of Blackouts?

The EPA and utility commissions routinely employ externality cost estimates for carbon dioxide and other greenhouse gases (GHGs) using a metric called the Social Cost of Carbon (SCC). But these regulators completely ignore the negative externalities their rules or IRP determinations may cause by regulating reliable power plants off the grid or allowing them to be shuttered prematurely to reduce emissions. (continue reading)

 

The Price of Darkness: A First Look at Blackout Economics