Mitigating electricity supply risks through flexible quota reallocation under cross-sectoral carbon market expansion

China hosts the world's largest carbon trading market, yet the effectiveness of market-based regulatory tools remains uncertain, as the electricity and carbon markets are not yet fully integrated. And the inclusion of other high-emission industries into China's carbon market underscores the urgent need to reassess quota allocation strategies, as the power sector may face emerging risks previously masked by stability regulatory. In this study, we evaluate regional supply risks, and associated economic losses under the current carbon quota allocation. To address the observed limitations, we propose a flexible quota reallocation mechanism designed to reduce systemic risk. Our results show that the efficiency allocation method may lead to a 53.22 % electricity supply gap and an economic loss of 7.89 %, particularly under market uncertainty with expanding sectoral coverage. In contrast, the proposed reallocation mechanism enhances electricity trading activity in 16 regions and prevents economic losses in 24 regions. We further quantify the uncertainty boundaries associated with different allocation principles to inform mechanism selection across varied scenarios. This study contributes to the broader discourse on carbon market policy design in regulated power markets.