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Assessment of investment efficiency in a power system under performance-based regulation

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  • Božič, Dušan
  • Pantoš, Miloš

Abstract

The paper presents a new method for reliability investment decisions when a reward/penalty scheme is applied to the regulation of (distribution system operators) DSOs. The method was developed in order to facilitate the transition from (cost-based regulation) CBR to (performance-based regulation) PBR for distribution utilities. New investment planning criteria for distribution utilities subjected to the new regulatory regime are identified and mathematically formulated as a new (investment efficiency index) IEI, which yields the relation between the improvement of system reliability due to the investment in the electric system and total investment costs. To determine the improvement of system reliability due to the investment in the electric network, the method uses the (Monte Carlo) MC simulation technique for the modeling of the stochastic nature of outages in electric networks, along with a (linear program) LP, which enables us to calculate load flow equations under a fault state and provides information about power deficits in the electric system. The method was tested on Slovenian distribution systems, where several investment candidates were compared in order to determine which projects need to be undertaken in order to achieve the highest possible reliability increase.

Suggested Citation

  • Božič, Dušan & Pantoš, Miloš, 2013. "Assessment of investment efficiency in a power system under performance-based regulation," Energy, Elsevier, vol. 51(C), pages 330-338.
    • Handle: RePEc:eee:energy:v:51:y:2013:i:c:p:330-338
    DOI: 10.1016/j.energy.2012.11.038
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    References listed on IDEAS

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    1. Wu, F.F & Zheng, F.L. & Wen, F.S., 2006. "Transmission investment and expansion planning in a restructured electricity market," Energy, Elsevier, vol. 31(6), pages 954-966.
    2. Bresesti, Paola & Calisti, Roberto & Cazzol, Maria Vittoria & Gatti, Antonio & Provenzano, Dario & Vaiani, Andrea & Vailati, Riccardo, 2009. "The benefits of transmission expansions in the competitive electricity markets," Energy, Elsevier, vol. 34(3), pages 274-280.
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    Citations

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    Cited by:

    1. Ghasemi, Mostafa & Dashti, Reza, 2017. "A risk-based model for performance-based regulation of electric distribution companies," Utilities Policy, Elsevier, vol. 45(C), pages 36-44.
    2. Božič, Dušan & Pantoš, Miloš, 2015. "Impact of electric-drive vehicles on power system reliability," Energy, Elsevier, vol. 83(C), pages 511-520.
    3. Ghasemi, Mostafa & Dashti, Reza, 2018. "Designing a decision model to assess the reward and penalty scheme of electric distribution companies," Energy, Elsevier, vol. 147(C), pages 329-336.
    4. Sreenithya Sumesh & Vidyasagar Potdar & Aneesh Krishna, 2019. "Cubic reward penalty structure for power distribution companies," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 10(3), pages 350-368, June.
    5. Janjic, Aleksandar & Velimirovic, Lazar Z. & Vranic, Petar, 2021. "Designing an electricity distribution reward-penalty scheme based on spatial reliability statistics," Utilities Policy, Elsevier, vol. 70(C).
    6. Davidov, Sreten & Pantoš, Miloš, 2017. "Stochastic assessment of investment efficiency in a power system," Energy, Elsevier, vol. 119(C), pages 1047-1056.

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