The Electricity Outage Cost in Iran: An Input Output Analysis

Document Type : Research Paper

Authors

Faculty of Management and Economics, Shahid Bahonar University of Kerman, Kerman, Iran.

Abstract

Electricity is the backbone of modern economies, and its absence, even temporarily, can lead to far-reaching consequences. This study estimates the cost of electricity shortages across Iranian economic sectors in 2023 using an Input-Output (I-O) analytical framework. Based on the most recent I-O table published by the Central Bank of Iran, the research evaluates how unsupplied electricity affects industries in terms of lost value-added, expressed in million Tomans per kilowatt-hour (kWh). The analysis is conducted under two main scenarios: (i) a purely economic perspective and (ii) an integrated socio-economic perspective that incorporates social considerations alongside economic factors. The findings reveal considerable variation in sensitivity across sectors. Industries such as forestry, mining, and chemicals show relatively low vulnerability, while others, especially food production, furniture manufacturing, construction, pipeline transport, and key public services, face significantly higher losses when electricity is disrupted. Notably, the food sector registers an outage cost nearly three times the national average, and public services such as defense and healthcare emerge as particularly exposed. Beyond quantifying these costs, the study demonstrates how I-O analysis can support optimal electricity allocation strategies during shortage periods. By identifying which sectors are most sensitive, the results provide actionable insights for policymakers tasked with balancing economic efficiency and social welfare when planning resilience strategies and infrastructure

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References

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History

  • Receive Date: 17 June 2025
  • Revise Date: 28 September 2025
  • Accept Date: 01 October 2025

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