SORS/WomenInBSC: Smart Rationing: Designing Electricity Blackout Policies for Extreme Events

Systemic blackouts have increased due to extreme weather events and supply shortages, leading to a prominent example of demand rationing. Exploiting features of smart meters, we propose a partial rationing policy for residential households to avoid blackouts. We have two main findings. First, partial rationing policies can be equivalent to large rolling blackouts, even when the partial rationing is generous. Second, due to selection, partial rationing policies reduce the number of households effectively impacted by the rationing event, even without losing power. We conclude with a discussion of open questions about the design of optimal rationing policies.