The Real Cause of Blackouts

[toor]

There can be shortages especially in areas where products have very special properties. Electricity is one of those products.

There are high costs to entry.

It takes a lot of time to increase the output of a generator by small amounts. I.e. if you want to output 10% more then u are currently it can take hours to get there.

Electricity consumption changes by the minute in huge directions.

Electricity cant be stored (a truly rareproperty). ANy extra produced is waste. And you can't produce a certain amount in the morning and then see how demands develop over the day. You need to produce the perfect amount at every given time.

So to maximize profits as a company you only want to produce exactly what demand is. But demand can change quickly, and even though the marginal cost of production might be low ($) wise, in terms of time you can't simply "up your output" it takes hours. But the demand doesnt last that long.

Not your standard good in other words. So yes you could have shortage even though marginal utility > marginal cost of production.