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University of California, Berkeley
University of Chicago
Lawrence Berkeley National lab
Sample size: 2120
Field period: 06/16/2021-01/10/2022
Respondents who are notified of hypothetical upcoming power outages will have lower stated willingness-to-pay to avoid power outages.
Additional Research Questions:
1) How does prior ownership of back-up power impact respondents willingness to pay to avoid power outages?
2) Are respondents with higher-income and/or weather levels willing-to-pay more to avoid power outages?
The first questions of the survey focused on respondent experiences and future expectations for sustained power outage events. We draw three key conclusions from the responses to these questions. First, we find that almost the entirety of the sample is aware of wildfire-related power outages, though only 25% experienced one. Second, we find that at the time of the survey the annual mean expectations for future power outages are relatively low at 12 hours per year per respondent, with that number roughly doubling if respondents reported experiencing a sustained power outage over the last three years (i.e. 2018-2021). Finally, we find that while backup power purchases have increased in recent years, low cost mitigation options like using flashlights and candles remain more popular (75% of respondents report using these low-cost strategies compared to 20% for other mitigation options).
For the experimental question, we find that respondents had positive and statistically significant stated WTP to avoid power outages ($85/month std. error $11/month). The WTP did not depend significantly on the advanced notification of the power outage ( - $16/month std. error $16/month for 1-day notice; -$6/month std. error $16/month for 1-week notice). Respondents who indicated ownership of back-up power had a higher WTP to avoid power outages than non-back-up power owners ($83/month increase s.e. $13/month). An exploration of heterogeneity suggested that household wealth (proxied using estimated home value) is negatively correlated with WTP. This relationship, however, is not present with household income, which was not a strong determinant of respondents’ WTP.