ECN publication
Business models for DSOs under alternative regulatory regimes (D10)
Published by: Publication date:
ECN Policy Studies 27-8-2007
ECN report number: Document type:
ECN-E--07-038 ECN publication
Number of pages: Full text:
61 Download PDF  

We expect sustainability and energy efficiency targets as set at the European and world level to be a continuing driving force behind an increasing penetration of distributed generation (DG) in distribution networks. But the costs and benefits associated with such a transition might be asymmetrically distributed across energy market actors. In this report we show how the owner of the distribution network, the distribution system operator (DSO) is affected by an increase in the level of DG penetrating the distribution network. We show, with the use of a financial (spreadsheet) model and taking into account a number of network and DG unit characteristics, that DSOs are likely to be negatively affected when DG penetration reaches high levels. At low DG penetration levels we expect DSOs to gain somewhat from DG presence in the network. In addition, we propose and analyse some regulatory measures through which any potentially negative impact of DG penetration on the DSO business can be mitigated or even neutralised.

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