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

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dc.contributor.authorBjørndal, Endre
dc.contributor.authorBjørndal, Mette
dc.contributor.authorBuvik, Magnus
dc.contributor.authorBørke, Christian Nærup
dc.contributor.authorGramme, Eivind
dc.date.accessioned2019-01-03T00:17:08Z
dc.date.available2019-01-03T00:17:08Z
dc.date.issued2019-01-08
dc.description.abstractIn 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.extent11 pages
dc.identifier.doi10.24251/HICSS.2019.431
dc.identifier.isbn978-0-9981331-2-6
dc.identifier.urihttp://hdl.handle.net/10125/59792
dc.language.isoeng
dc.relation.ispartofProceedings of the 52nd Hawaii International Conference on System Sciences
dc.rightsAttribution-NonCommercial-NoDerivatives 4.0 International
dc.rights.urihttps://creativecommons.org/licenses/by-nc-nd/4.0/
dc.subjectPolicy, Markets, and Computation
dc.subjectElectric Energy Systems
dc.subjectDistribution networks
dc.subjectEnd-user flexibility
dc.subjectInvestment
dc.subjectRegulation
dc.subjectTariffs and compensation methods
dc.titleEnd-User Flexibility in the Local Electricity Grid – Blurring the Vertical Separation of Market and Monopoly?
dc.typeConference Paper
dc.type.dcmiText

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