Majd Olleik | Searcharxiv

arXiv2026

Household coping mechanisms under grid failure: Evidence from a high electrification context in Lebanon

Despite near-universal electrification in many countries, electricity supply shortages continue to shape household energy use. This paper examines how households adapt to chronic grid failure in high-electrification, high-dependence contexts, using Lebanon as a case study. Drawing on original survey data from 1,000 households, we analyze both supply-side coping mechanisms such as diesel generators and solar photovoltaic (PV)-battery systems, and demand-side adaptations, including load shifting and demand suppression. The results reveal a landscape of household responses, where socioeconomic status plays a central role in determining access to backup solutions and the extent of met demand. While diesel generators remain widespread, a transition toward PV-battery systems is observed, especially among financially capable households. However, decentralized self-generation is associated with inefficiencies, including substantial levels of curtailed solar generation. On the demand side, households exhibit reductions in electricity use, leading to distinct consumption profiles depending on the type of backup system employed. These findings highlight the importance of distinguishing between met and unmet demand when assessing energy needs under unreliable supply. The paper contributes to the literature by providing a quantitative characterization of the interaction between self-generation and demand adaptation in a supply-constrained high-electrification context. It also offers empirical demand profiles that incorporate suppressed consumption, addressing a key gap in electricity system planning. From a policy perspective, the results underscore the need to account for unmet demand, address inequities in access to coping technologies, and reduce inefficiencies in decentralized systems.

econ.GN↗

arXiv2026

Market Power and Distributed Solar Integration in Microgrids under Limited Regulation

Decentralized electricity systems increasingly emerge where centralized grids fail to provide reliable supply. In such settings, privately operated neighborhood microgrids, often based on diesel generators, exhibit significant market power, limited regulatory oversight, and high environmental externalities. In parallel, households increasingly deploy off-grid solar photovoltaic (PV) systems to gain control over electricity supply. However, these systems suffer from curtailed excess generation during peak solar hours and unreliable access at other times. While prior studies have optimized microgrids in low-reliability grid contexts from a techno-economic perspective, they largely neglect the market power exerted by monopolistic private generators. This paper addresses this gap by developing a bi-level game-theoretic model that enables household-generated electricity to be fed into the microgrid while explicitly accounting for the market power of a neighborhood diesel generator company (DGC). The regulator sets price and feed-in-tariff caps to maximize household economic surplus (HES), while the DGC acts as a profit-maximizing agent controlling access and supply. The model is illustrated using high-resolution empirical data from Lebanon. Results show that: (i) price and feed-in-tariff caps substantially increase HES and consistently induce significant household PV feed-in to the microgrid; (ii) higher DGC budgets or greater PV-owner penetration lead to pronounced gains in HES; and (iii) the renewable energy share reaches 60% under base conditions and approaches 100% at sufficiently high budgets or PV-owner penetration levels, compared to 0% under the status quo.

eess.SY↗