Businesses need to do a better job of anticipating power outages

'Real-option theory can be applied to help companies anticipate power outages. - Kees-Jan van Vliet

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Increased Consumption
Businesses and households are using more and more energy, and at the same time there is a growing commitment to sustainability. There is a danger that the power grid cannot keep up with the pace of increasing demand and energy transition.

We see that pressure on the power grid is firmly increasing. This has an impact on households, but also on business and the business climate. If security of supply cannot be guaranteed, businesses come to a standstill, leading to cross-sector supply chain problems. If companies cannot get a connection to the energy grid, there is a chance that they may have to consider relocating abroad.

This raises the question of how companies can monitor energy supply so that they can anticipate peak times. First of all, relevant data must be generated for this, possibly in cooperation with specialized parties. Then this must be visualized and linked to a scenario with actions to be taken. This could be the purchase of a generator, the installation of solar panels and batteries. Or, more radically, changes in the production process such as performing energy-intensive processes at night.

Real-option theory

Real-option theory can be applied to help companies anticipate power outages. By identifying possible scenarios and appreciating the probabilities and risks of different options, companies can better decide how to act during power outages. For example, investing in backup generators or battery storage, or shifting energy-intensive processes to another time of day. By valuing these options using real-option theory, companies can better assess which investments will provide the most value and the best protection against power outages. This can help ensure business continuity and prevent supply chain problems.

Cause: Alliander blijft aansluiten ondanks krap stroomnet