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Solar storm could shut down U.S. grid for months

Staff Writer |
A severe solar storm striking the continental U.S. could cause trillions of dollars in damage to the global economy and shut down portions of the U.S. grid for up to a year.

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This is according to a new study prepared by the Cambridge Centre for Risk Studies for insurance firm AIG.

"We estimate a range of U.S. insurance industry losses resulting from three variants of the scenario which explore different damage distributions and restoration periods, culminating in losses between $55.0 and $333.7 billion.

"At the low end, this is roughly double the insurance payouts of either Hurricane Katrina or Superstorm Sandy, and similar to the total insured losses from all catastrophes in 2015.

"Overall economic losses are evaluated from two perspectives. First, we estimate global supply chain disruption footprints that stem from suspended business and production activity directly caused by power outages in the U.S.

"This perspective provided a detailed industry sector breakdown of potential economic losses but does not account for the dynamic response of the economy. Global supply chain disruptions are conservatively estimated to range from $0.5 to $2.7 trillion across the three scenario variants."

"In both the S2 and X1 scenarios 33% of transformers are tripped off-line, 14% sustain minor damage, 3% sustain major damage and 0.2% are completely destroyed. The loss of these assets leads to a power outage initially affecting 145 million U.S. citizens.

"In the S1 scenario most of the affected population has power restored within a few hours while 15% of those affected remain without power for up to three months or longer.

"In the X1 scenario, more people are affected and some 10% of those lack power for a ten-month period."

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