The amount of distributed generation (DG) is steadily growing in many countries as a result of existing energy policies. Thus, high shares of DG are bound to appear in many areas, causing a significant impact on distribution networks. After liberalisation, electricity distribution has remained as a regulated activity due to its characteristics of natural monopoly. Nowadays, some form of incentive regulation is mostly used to regulate distribution system operators (DSOs). This kind of regulation makes regulators face considerable difficulties. Therefore, several tools and methodologies have been developed to support them, such as benchmarking, reference networks, etc. However, it is in very few cases that DG is explicitly considered in practice. Hence, the regulatory tools and methodologies may not be fit to account for DG. This paper identifies gaps in the regulatory tools and methodologies and proposes specific improvements. The emphasis is placed on three topics that can be most affected by DG: network investments, energy losses and continuity of supply. The main objective is to facilitate the tasks of regulators and enhance the integration of DG. Since it is very complicated to provide regulatory recommendations broadly applicable, the focus is placed on the regulatory frameworks of Spain and Portugal, which will be presented and discussed in detail.
Keywords: distribution network, distributed generation, distribution system operators, regulation
17th Power Systems Computation Conference - PSCC'11. Estocolmo, Suecia. 22-26 Agosto 2011
Published: August 2011.