Researchers at the Department of Energy's Oak Ridge National Laboratory have provided the first comprehensive analysis of the specific costs of power outages to local customers across the nation. It found that the average yearly cost of major outages topped $67 billion over the past seven years.
The total annual burden on customers rose sharply over that time, with the price tag of major outages climbing to $121 billion in 2024. These power disruptions pose serious risks to public health and safety and drain billions of dollars from the U.S. economy.
Outage costs for multiple customer types in most counties were computed using publicly available government data sources combined with an existing, publicly available cost calculator, creating a new tool to help governments and utilities make decisions about grid modernization. It was recently incorporated in an ORNL-developed grid planning application called TASTI-GRID, short for Technical Assistance for States and Tribes Initiative: Grid Resilience Investment Decision-Making.
"When state energy officials can see the dollars and cents of outages in their particular areas, they can make better choices," said ORNL lead researcher Narayan Bhusal. "This provides them even more information to meet their goal of striking the best balance between keeping rates affordable and having a reliable system. When a utility prioritizes the right high-value grid investments, its revenue will increase, customers will have shorter and fewer outages, and business customers will generate more income."
Previous studies focused on utility costs or impacts on a single region or customer type. This is the first time a study has gauged the cost of unreliable electricity to customers nationwide, across geographic scales and customer types. The study evaluates the cost of major outages between 2018 and 2024, broken down by residential-and non-residential customers and by county in the 90% of counties with reliable data.
Where power outages cost customers the most
Power outages cost commercial and industrial customers an average of $6,031 in 2024. Findings showed the number and length of outages increasing, with total customer costs rising accordingly. Between 2018 and 2024, the number of major outages nationwide jumped 29%, from 4,666 to 6,533. The average major outage - defined as a power disruption affecting 30,000 customers or 15% of the county's customer base, whichever is less -- lengthened from 9.6 hours to 11.8 hours.
The analysis of costs and cost increases by state showed a climbing impact on customers. For instance, in 2018, the highest outage costs for customers in any single state was $7.8 billion. But by 2024, the highest annual cost for a single state was almost five times more at $38.9 billion.
The highest costs per customer for each outage are concentrated in the Southeast. In these states as well as others along the coasts, annual outage costs often correlate to extreme weather events such as hurricanes, wildfires and heat waves. But these did not explain all cost extremes.
Regardless of the weather, outages in places like Louisiana, Texas, California, Michigan and Virginia persistently hit customers hard in the wallet. Texas, the only state served mostly by its own independent electric grid, stands out with the highest total outage costs over the study period at more than $80 billion.
Similar patterns emerged at the county level. For example, one inland county in rural South Carolina topped out with each household losing almost $400 per outage and each non-residential customer losing $140,000 when the power failed - the highest among U.S. counties for both categories.
Data tools reveal nationwide outage impacts
These assessments start with the Interruption Cost Estimate Calculator developed by Lawrence Berkeley National Laboratory, a tool used by grid operators and electric utilities to understand customer impacts. The calculator uses different approaches to estimate residential and business costs. For households, the key driver is the disruption of daily life. The residential cost model incorporates customer willingness to pay to avoid an outage, which serves to measure the value of avoiding tangible costs such as relocation, buying extra supplies or being unable to work from home.
For businesses and industries, the cost is a straightforward calculation based on lost production plus the direct costs of the interruption, minus any energy savings.
This calculator was designed to estimate state-level costs. Bhusal dove deeper, incorporating many county-level data sets and then using geospatial, mathematical and time-based analysis to identify patterns and measure outcomes.
Researchers incorporated multiple data sources hosted at ORNL, including real-time power outage data from DOE's Environment for Analysis of Geo-Located Energy Information ( EAGLE-I ) and Outage Data Initiative Nationwide ( ODIN ). They also leveraged demographic and economic data from the U.S. Census Bureau and Bureau of Economic Analysis, infrastructure data from the Federal Emergency Management Agency and the Department of Homeland Security, and annual energy consumption data from the U.S. Energy Information Administration.
Through these datasets, ORNL estimated variables such as the number of customers impacted, residential customers' annual income level, the gross domestic product and industry of non-residential customers, annual energy consumption, and the timing of the event, such as the season of the year and day of the week.
Bhusal said new capabilities will be added in the future so state energy officials can explore the cost implications of small, frequent outages; how outage length affects losses; and the total price of specific weather events affecting electricity over a long period, as when Hurricane Helene destroyed sections of North Carolina's electric grid in 2024.
As part of TASTI-GRID, the research was funded by DOE's Grid Deployment Office. Other ORNL researchers who contributed to the project include Giri Iyer, Supriya Chinthavali, Nasir Ahmad and Sangkeun Matthew Lee.
UT-Battelle manages ORNL for the Department of Energy's Office of Science, the single largest supporter of basic research in the physical sciences in the United States. The Office of Science is working to address some of the most pressing challenges of our time. For more information, please visit energy.gov/science .
