End-User Flexibility in the Local Electricity Grid – Blurring the Vertical Separation of Market and Monopoly?

dc.contributor.author Bjørndal, Endre
dc.contributor.author Bjørndal, Mette
dc.contributor.author Buvik, Magnus
dc.contributor.author Børke, Christian Nærup
dc.contributor.author Gramme, Eivind
dc.date.accessioned 2019-01-03T00:17:08Z
dc.date.available 2019-01-03T00:17:08Z
dc.date.issued 2019-01-08
dc.description.abstract In the Norwegian electricity system, new consumption patterns and changing load profiles increase an already apparent need for reinvestment in the aging network infrastructure. This is very costly, and network operators consider alternative ways of increasing capacity, which are less costly and more flexible. One such option is end-user flexibility. In the paper, we give an overview of the Norwegian electricity market and regulation and the potential of end-user flexibility. We present an investment case provided by a network company, which illustrates that the choice of compensation method to customers have a large impact on the cost and/or revenue cap in the regulatory model. By issuing direct payments for flexibility services, end-user flexibility results in a lower efficiency, although the revenue cap may be higher, while redistribution of network tariffs have a marginal effect on efficiency and the revenue cap. Through redistribution of network tariffs, the network operator can defer investments without a notable change in the revenue cap or change in efficiency. This highlights some of the future challenges that the regulator faces in setting a regulatory framework for end-user flexibility and it challenges the vertical separation that has been a corner stone in the deregulated electricity market.
dc.format.extent 11 pages
dc.identifier.doi 10.24251/HICSS.2019.431
dc.identifier.isbn 978-0-9981331-2-6
dc.identifier.uri http://hdl.handle.net/10125/59792
dc.language.iso eng
dc.relation.ispartof Proceedings of the 52nd Hawaii International Conference on System Sciences
dc.rights Attribution-NonCommercial-NoDerivatives 4.0 International
dc.rights.uri https://creativecommons.org/licenses/by-nc-nd/4.0/
dc.subject Policy, Markets, and Computation
dc.subject Electric Energy Systems
dc.subject Distribution networks
dc.subject End-user flexibility
dc.subject Investment
dc.subject Regulation
dc.subject Tariffs and compensation methods
dc.title End-User Flexibility in the Local Electricity Grid – Blurring the Vertical Separation of Market and Monopoly?
dc.type Conference Paper
dc.type.dcmi Text
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