This post began as a question about whether a resilient and redundant power grid would be a public good which as I composed it took a somewhat different turn. I may be able to move back in that direction. We’ll see.
Have you ever looked at a utility bill? Not just the You owe this part but looked at it in detail? My electricity bill and my gas bill look very much the same: I’m billed at such and such a rate for each unit (kwH, therm) I use and to this is added a service charge, taxes, and fees. My cable, phone, water, and cellphone bills are a little different: I’m billed at a fixed rate for the services I’ve contracted for, I’m billed more if I use any additional services, and to that is added a service charge, taxes, and fees.
The service charges and fees are all monthly. You couldn’t contract for a day’s worth of electricity if you wanted to. And here’s my point: the most you’ll ever get from your cable company if they fail to provide the service you’ve contracted for is a pro rata reduction. You’ll get nothing from the power company when the power is out.
Compare that with the register tape you get when you buy groceries. They refund at the unit of measure at which whatever you’re returning is sold at. They don’t refund for a single bad egg.
But we pay the gas, electric, and cable companies for a month of service without necessarily receiving a month of service.
Now I think I may have circled around. It’s obvious that electricity, water, or gas aren’t public goods. You and your neighbor can’t consume the same electricity , gas, or water (rivalrous) and you can have your house connected to the gas company without your neighbor being connected (excludable). Slightly more tenuous arguments can be made for cellphone and cable service (excludable but probably non-rivalrous, therefore club goods).
However, continuity of service is a somewhat different matter. It seems to me that as a practical matter it’s impossible for the electric or gas company to provide reliable continuity of service that isn’t non-rivalrous and non-excludable.
I don’t think I’ve had a month of continuous service from the electric company or the cable company (through which I get my broadband Internet connection) since I moved into this house nearly 30 years ago. I’ve had better service from the gas company and the phone company. The city provides the water and it’s only been out a couple of times over the years.
Why don’t the electric company and the cable company provide continuity of service? It is technically within their capability to provide continuity to a much higher degree than they’re doing. Clearly, they don’t have enough incentives to do so, allowing discontinuity of service helps them realize lower costs, and, since their rates are at least nominally controlled by commissions and the commissions let them get away with their practices, they charge for services they’re not providing.
I don’t take any particular comfort in knowing that my electricity, cellphone, and Internet connection are all likely to be unavailable at the times when I may need them the most. That’s why I keep my telephone landline. The phone company has its own power grid.