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Impact of Economic Regulation on Distributed Generation Integration in Electricity Distribution Grids
KTH, School of Electrical Engineering (EES), Electric Power Systems.
2015 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

Energy policies in favor of a larger adoption of renewable energy sources for electricity production purposes and the significant progress of several renewable technologies are among the main drivers behind an increasing integration of distributed generation (DG) in distribution networks.

DG affects distribution network planning and operation and, consequently, higher or lower network costs than in a traditional passive network scenario arise.

Two main complementary tools for an efficient integration of DG have been identified in this thesis: (i) a sound economic regulation of Distribution System Operators (DSOs) for taking into account DG-driven potential costs and accordingly remunerating DSOs, and (ii) network tariff design, in order to allocate network costs and re-distribute potential benefits to different grid users.

Distribution economic regulations vary from country to country with grid characteristics and regulatory customs. In order for Regulators to promote the integration of DG units according to policy objectives, the potential impact of DG on the different distribution costs needs to be analyzed and quantitatively assessed: in this thesis, these objectives are achieved by using a novel model that combines the technical characteristics of distribution grids with the regulatory details specific of each regulation.

Once computed, DSOs' total allowed revenue is allocated to different users' categories according to the adopted tariff structures. This thesis focuses on the challenges arising within the traditional paradigm of distribution tariff design when an increasing amount of DG is connected to the grids. In particular, the consequences of DG exemption from distribution tariffs and the application of load-tailored tariff schemes to DG are investigated, both from a qualitative and quantitative point of view; cross subsidies between consumers and DG owners are computed by applying a cost causality principle.

Place, publisher, year, edition, pages
Stockholm: KTH Royal Institute of Technology, 2015. , xi, 90 p.
Series
TRITA-EE, ISSN 1653-5146 ; 2015:75
Keyword [en]
Distributed generation, distribution economic regulation, regulatory impact, distribution tariff design, cost allocation methodologies, cross subsidies
National Category
Engineering and Technology
Research subject
Electrical Engineering
Identifiers
URN: urn:nbn:se:kth:diva-174342ISBN: 978-91-7595-715-9 (print)OAI: oai:DiVA.org:kth-174342DiVA: diva2:859675
Public defence
2015-11-02, F3, Lindstedtsvägen 26, KTH, Stockholm, 10:00 (English)
Opponent
Supervisors
Note

The Doctoral Degrees issued upon completion of the programme are issued by Comillas Pontifical University, Delft University of Technology and KTH Royal Institute of Technology. The invested degrees are official in Spain, the Netherlands and Sweden, respectively. QC 20151009

Available from: 2015-10-09 Created: 2015-10-05 Last updated: 2015-10-09Bibliographically approved
List of papers
1. State-of-art review on regulation for distributed generation integration in distribution systems
Open this publication in new window or tab >>State-of-art review on regulation for distributed generation integration in distribution systems
2012 (English)Conference paper, Published paper (Refereed)
Abstract [en]

Integration of distributed generation (DG) into distribution networks may affect many different factors, such as network reliability, voltage quality and network planning. Network regulation, therefore, is needed to provide the distribution system operators (DSOs) with fair business, meanwhile protecting the consumers and producers from any potential exploitation by the DSOs because of their monopoly situation. EU Member States have implemented different regulations, but there is no consensus yet as to what is the most appropriate mechanism for a successful and efficient integration of DG in distribution grids. This paper reviews the state-of-art of the regulatory frameworks for the integration of DG in some EU countries, and methods to model the regulation impact on DG integration in distribution systems. For each regulatory scheme, the main critical issues concerning DG integration are identified.

Keyword
Distributed generation, Distribution networks, Network regulation, State-of-art Review
National Category
Engineering and Technology
Identifiers
urn:nbn:se:kth:diva-98775 (URN)10.1109/EEM.2012.6254769 (DOI)2-s2.0-84866785216 (Scopus ID)
Conference
9th International Conference on the European Energy Market, EEM 12;Florence;10 May 2012through12 May 2012
Funder
StandUp
Note

QC 20130115

Available from: 2012-07-02 Created: 2012-07-02 Last updated: 2015-10-09Bibliographically approved
2. Incentive from network regulation for distribution system operators to integrate distributed generation: The Portuguese case
Open this publication in new window or tab >>Incentive from network regulation for distribution system operators to integrate distributed generation: The Portuguese case
2013 (English)In: European Energy Market (EEM), 2013 10th International Conference on the, IEEE , 2013, 6607376- p.Conference paper, Published paper (Refereed)
Abstract [en]

Increasing amount of distributed generation (DG) connected to distribution grids is likely to affect the operation of the grids themselves, for example by changing the magnitude and, in some cases also the directions, of the power flows in the networks. This can have different economic consequences on the Distribution System Operators (DSOs) depending on the different enforced network regulations. This paper proposes a method for how to calculate the incentive for DSOs to integrate DG into their grids. The calculation of this incentive is carried out for the Portuguese case. Only the operational aspects are considered to calculate costs and benefits for the DSO, including network tariffs, ancillary services costs, Operation and Maintenance (O&M) costs, and economic treatment of losses. The IEEE 34 Node Test Feeder is used to perform power flow analyses under different scenarios of DG penetration. The analysis shows that the Portuguese DSO would have an incentive to integrate a low level of DG penetration; in case of a higher level of DG penetration, however, this incentive would turn into a small disadvantage for the DSO. In both cases, the regulatory treatment of network losses turns out to be the relevant factor to determine such a result.

Place, publisher, year, edition, pages
IEEE, 2013
Series
International Conference on the European Energy Market, EEM, ISSN 2165-4077
Keyword
distributed generation, distribution losses, network regulation, Portuguese regulation, tariffs
National Category
Energy Systems
Identifiers
urn:nbn:se:kth:diva-140995 (URN)10.1109/EEM.2013.6607376 (DOI)2-s2.0-84891605925 (Scopus ID)978-147992008-2 (ISBN)
Conference
10th International Conference on the European Energy Market, EEM 2013; Stockholm; Sweden; 27 May 2013 through 31 May 2013
Note

QC 20140205

Available from: 2014-02-05 Created: 2014-02-05 Last updated: 2015-10-09Bibliographically approved
3. Distributed generation exemption from network tariffs: general implications and analysis of a case study
Open this publication in new window or tab >>Distributed generation exemption from network tariffs: general implications and analysis of a case study
2015 (English)Conference paper, Published paper (Refereed)
National Category
Engineering and Technology
Identifiers
urn:nbn:se:kth:diva-174860 (URN)
Conference
5th Latin America Energy Economics Meetingm Medellin, 2015
Note

QC 20151008

Available from: 2015-10-07 Created: 2015-10-07 Last updated: 2015-10-09Bibliographically approved
4. Impact of Network Regulation on the Incentive for DG Integration for the DSO: Opportunities for a Transition Toward a Smart Grid
Open this publication in new window or tab >>Impact of Network Regulation on the Incentive for DG Integration for the DSO: Opportunities for a Transition Toward a Smart Grid
2015 (English)In: IEEE Transactions on Smart Grid, ISSN 1949-3053, E-ISSN 1949-3061, Vol. 6, no 4, 1730-1739 p.Article in journal (Refereed) Published
Abstract [en]

The integration of distributed generation (DG) in distribution grids is one of the pillars of smart grid deployment. However, an increasing amount of DG connected to distribution grids is likely to affect the operation of the grids themselves, e.g., changing the magnitude, and in some cases the direction, of power flows. In order to perform the transition to a smart grid, it is therefore essential to have the distribution system operators (DSOs) involved in the process. However, being that the DSOs' business is controlled by regulators, regulation has a fundamental impact on the speed and the actual performance of DSOs' involvement in the transition toward a smart grid. Therefore, a method is needed to assess network regulation impact on DSOs' incentive to integrate DG into their grids. This paper proposes a new method for the calculation of such incentive, and the method has been applied on a case study to the Portuguese, Danish, and Swedish regulations for different scenarios of DG penetration. The focus is on DSOs' operational costs and revenues. The analyses indicate that DG has a different impact on DSOs business, depending on the different regulations, the most relevant aspects being the structure of customer tariffs and the regulatory treatment of network losses.

National Category
Electrical Engineering, Electronic Engineering, Information Engineering
Identifiers
urn:nbn:se:kth:diva-171110 (URN)10.1109/TSG.2015.2409313 (DOI)000356810900016 ()2-s2.0-84933048927 (Scopus ID)
Note

QC 20150720

Available from: 2015-07-20 Created: 2015-07-20 Last updated: 2017-12-04Bibliographically approved
5. Distributed generation and distribution pricing: Why do we need new tariff design methodologies?
Open this publication in new window or tab >>Distributed generation and distribution pricing: Why do we need new tariff design methodologies?
2015 (English)In: Electric power systems research, ISSN 0378-7796, E-ISSN 1873-2046, Vol. 119, 370-376 p.Article, review/survey (Refereed) Published
Abstract [en]

Due to the increasing amount of DG (distributed generation) in distribution grids, new challenges are arising in the distribution sector in many countries. Depending on the DG penetration, location, concentration, size and generation technology, the DG impact on network costs can be either negative or positive. These additional costs or benefits can be allocated to the DG owners through network tariffs. New cost allocation methodologies, based on a cost causation principle, are therefore required. This paper addresses several issues arising within network tariff design due to the integration of DG. Furthermore, it reviews the methodologies proposed so far to tackle those issues. Recommendations for setting up a new, cost causation-based, methodology are finally drawn.

Keyword
Distributed generation, Distribution tariffs, Cost allocation methodologies, Net Metering, Cost Causality Principle, Innovative Tariffs
National Category
Electrical Engineering, Electronic Engineering, Information Engineering
Identifiers
urn:nbn:se:kth:diva-159969 (URN)10.1016/j.epsr.2014.10.021 (DOI)000347756700041 ()2-s2.0-84910679389 (Scopus ID)
Note

QC 20150306

Available from: 2015-03-06 Created: 2015-02-12 Last updated: 2017-12-04Bibliographically approved
6. Electricity distribution tariffs and distributed generation: quantifying cross-subsidies from consumers to prosumers
Open this publication in new window or tab >>Electricity distribution tariffs and distributed generation: quantifying cross-subsidies from consumers to prosumers
Show others...
2015 (English)In: Utilities Policy, ISSN 0957-1787, E-ISSN 1878-4356, Vol. 37, 23-33 p.Article in journal (Refereed) Published
Abstract [en]

An increasing amount of distributed generation (DG) can cause an increase or a decrease on distribution network costs. Tariff design is the main tool for allocating these costs to customers who own and operate DG resources. Currently, however, either DG units are exempt from paying distribution tariffs or they are subject to tariffs originally designed according to a traditional pricing model without DG in the grids, also known as load-based pricing. Partial recovery of the allowed distribution company revenue requirements or cross-subsidies between customers may ensue from such tariff arrangements. In this article, pricing, as represented by a combination of net metering and pure volumetric tariffs, is applied in the context of increasing DG. The paper presents a methodology where a Reference Network Model (RNM) is used to investigate the effect of this pricing scheme on the magnitude of cross-subsidies from consumers towards the so-called prosumers for a set of twelve simulations based on real-size networks in the U.S.For the considered scenarios, the analysis reveals substantial cross-subsidies from consumers toward prosumers. The degree of subsidy varies with the amount of DG connected to the grid and network characteristics. The rate of cross-subsidy tends to be higher for low-density grids. This paper contributes to the net metering literature with a quantitative assessment of cross-subsidies by comparing allocated payments to different actors with the costs they impose on the system, estimated through an RNM. Moreover, the paper proposed a tariff structure based on cost causality by proposing a cost-reflective, volumetric tariff approach through which aggregate load-driven and DG-driven network costs are accordingly allocated to loads and DG units.

Place, publisher, year, edition, pages
Elsevier, 2015
Keyword
Distribution tariffs, Distributed generation, Cost-allocation methodologies, Cost causality, Cross-subsidies
National Category
Engineering and Technology
Identifiers
urn:nbn:se:kth:diva-174863 (URN)10.1016/j.jup.2015.09.007 (DOI)000367110700003 ()2-s2.0-84949495828 (Scopus ID)
Note

QC 20160121

Available from: 2015-10-07 Created: 2015-10-07 Last updated: 2017-12-01Bibliographically approved

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Doctoral thesis_Angela Picciariello(1681 kB)10151 downloads
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Citation style
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  • fi-FI
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  • Other locale
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Output format
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