Energy Resilience Solutions: Combatting Power Outages and Economic Loss

In an increasingly connected and electronically driven world, the cascading consequences of power outages are dire to business and day-to-day life. Point-of-sale systems, online inventories, and just-in-time inventories all demonstrate how modern business relies on reliable electricity and can be indirectly impacted by power outages in different parts of the nation. For many organizations, pivoting to a low-tech operations model is simply not realistic.

An Energy Department estimate stated that power outages cost the U.S. economy $150 billion every year. Weather-related conditions cause 80% of power outages. Severe weather, high winds, rain, and thunderstorms are the most common causes. Winter weather — like snow, ice, and freezing rain — is the next most common. Tropical cyclones, extreme heat, and wildfires are also common causes of power outages. Power outages caused by tropical cyclones and wildfires can be the most destructive to power infrastructure and result in longer outages. Tropical cyclones and wildfires have both shown increased out-of-season activity, meaning these threats to the power grid exist for a longer share of the year than in the past.

Top 20 counties with highest average outage minutes 2018 - 2023:

• Loving County, Texas
• Sierra County, California 
• Mayaguez Municipio, Puerto Rico 
• Tensas Parish, Louisiana 
• Plumas County, California 
• Springfield Township, Arkansas 
• Wilkinson County, Mississippi 
• Calaveras County, California 
• Clay County, West Virginia 
• Mariposa County, California 
• Union Township, Puerto Rico 
• Beauregard Parish, Louisiana 
• St. John the Baptist Parish, Louisiana 
• Terrebonne Parish, Louisiana 
• Cameron Parish, Louisiana 
• Bayamon, Puerto Rico 
• Amador County, California 
• St. Charles Parish, Louisiana 
• Austin, Texas 
• Fairfax County, West Virginia 

How severe weather impacts power grid reliability

The devastation of storms and natural disasters can weaken power grids and produce conditions where they are more susceptible to system failure in the long term. 

Puerto Rico has experienced a sharp increase in outages across the entire territory after the island was struck by Hurricane Maria in September 2017. When María approached, Puerto Ricans were still coping with the aftermath of Hurricane Irma, which passed near the Caribbean island’s capital, San Juan, two weeks prior on September 6, 2017, bringing heavy rains, flooding, and wind gusts up to 100 miles per hour. Irma's glancing blow left roughly two-thirds of the population without electricity and roughly one-third of the population without clean water for several days.

Hurricane Maria was considered a devastating blow to Puerto Rico’s power grid. It is important to note that the hurricanes were not the only impact on the power grid. The island experienced a fire in September 2016 that knocked out power to 1.5 million customers.

Following Hurricane Maria, some Puerto Rican residents experienced power outages for 181 days or more. A reliable power grid has never truly been restored, as evidenced by massive island-wide outages on December 31, 2024.  

In February of 2021, Texas experienced extreme state-wide outages that meant unreliable or nonexistent power for more than two weeks. These outages are associated with 246 deaths across 77 counties. While Texas’ power grid is made up of many companies generating electricity via natural gas, coal, nuclear power, wind, and solar energy, most power plants in Texas rely on natural gas to produce the energy sold to customers. 

During the major outages of February 2021, most power plants struggled to produce energy in the extreme cold, this was the primary source of outages. Natural gas production is powered by electrical energy which is in turn powered by natural gas. During the worst of February 2021’s storm, over half of the state’s natural gas supply was shut down due to power outages and frozen equipment. 

Power outages impact the entire country, but states and counties with older infrastructure and greater exposure to extreme weather conditions face elevated exposure to interrupted access to electricity. 

Power outage risk management solutions for businesses

Much of the extant power grid across America was built in the 1960s and 1970s. The Energy Department estimates that 70% of transmission lines are more than 25 years old. Transmission lines typically have a 50 to 80-year lifecycle. 

Increasing research and resources are investigating the impacts and possible solutions in the relationship between natural disasters and their impact on the power grid, with potential energy resilience solutions including improved and renewed infrastructure investment for power reliability, systems featuring more redundancies, and increasing flexibility. 

Where infrastructural concerns are often driven by matters of state and government funding, organizations can evaluate their own cost and benefit analyses to determine the efficacy of investing in redundancies. Microgrids — which can enable an area to maintain electrical access even in instances where the primary power grid experiences an outage — have been demonstrated as a promising strategy.  

Mitigating strategies designed to protect against some energy risks do not necessarily make the power supply more secure along all dimensions. For instance, undergrounding powerlines improves upon vulnerabilities related to weather but does not improve protection against cyberattacks. 

Pinkerton Risk Pulse facilitates a greater understanding of exposure to electrical outages on a local level. Risk Pulse provides a highlight of major outages in recent history, expected annual outage minutes, and data-driven insights on the frequency and impact of outages affecting more than 5% of customers. This data can help Risk Pulse subscribers spot trends and parse meaningful data when power outage risk management and contingency planning.