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Network investments and the integration of distributed generation: Regulatory recommendations for the Dutch electricity industry

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  • Niesten, Eva

Abstract

An increase in the distributed generation of electricity necessitates investments in the distribution network. The current tariff regulation in the Dutch electricity industry, with its ex post evaluation of the efficiency of investments, average benchmarking and a frontier shift in the x-factor, delays these investments. In the unbundled electricity industry, the investments in the network need to be coordinated with those in the distributed generation of electricity to enable the system operators to build enough network capacity. The current Dutch regulations do not provide for a sufficient information exchange between the generators and the system operators to coordinate the investments. This paper analyses these two effects of the Dutch regulations, and suggests improvements to the regulation of the network connection and transportation tariffs to allow for sufficient network capacity and coordination between the investments in the network and in the generation of electricity. These improvements include locally differentiated tariffs that increase with an increasing concentration of distributed generation.

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Bibliographic Info

Article provided by Elsevier in its journal Energy Policy.

Volume (Year): 38 (2010)
Issue (Month): 8 (August)
Pages: 4355-4362

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Handle: RePEc:eee:enepol:v:38:y:2010:i:8:p:4355-4362

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Web page: http://www.elsevier.com/locate/enpol

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Keywords: Distributed electricity generation Network investments Regulation;

References

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  8. Gutierrez, Luis Hernando, 2003. "The Effect of Endogenous Regulation on Telecommunications Expansion and Efficiency in Latin America," Journal of Regulatory Economics, Springer, vol. 23(3), pages 257-86, May.
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Cited by:
  1. van der Welle, Adriaan J. & de Joode, Jeroen, 2011. "Regulatory road maps for the integration of intermittent electricity generation: Methodology development and the case of The Netherlands," Energy Policy, Elsevier, vol. 39(10), pages 5829-5839, October.
  2. Kranz, Johann & Picot, Arnold & Roemer, Benedikt, 2011. "Unlocking the potential of the smart metering technology: How can regulation level the playing-field for new services in smart grids?," 22nd European Regional ITS Conference, Budapest 2011: Innovative ICT Applications - Emerging Regulatory, Economic and Policy Issues 52183, International Telecommunications Society (ITS).
  3. Rob Aalbers & Viktoria Kocsis & Victoria Shestalova, 2011. "Optimal regulation under unknown supply of distributed generation," CPB Discussion Paper 192, CPB Netherlands Bureau for Economic Policy Analysis.
  4. Anna Pechan, 2014. "Which Incentives Does Regulation Give to Adapt Network Infrastructure to Climate Change? - A German Case Study," Working Papers V-365-14, University of Oldenburg, Department of Economics, revised May 2014.
  5. Haikel Khalfallah, 2013. "An assessment of Incentive Regulation in electricity networks: The story so far," Working Papers halshs-00931301, HAL.
  6. Nele Friedrichsen, 2011. "Governing Smart Grids - the Case for an Independent System Operator," Bremen Energy Working Papers 0011, Bremer Energie Institut.

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