Reported Innovation Intensity of Electricity and Gas DSOs Around the World

Michael G. Pollitt, Daniel Duma, Andrei Covatariu and Paul Nillesen

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: Electricity and gas distribution system operators (DSOs) are expected to play a crucial role in the energy transition. Hence, incentivizing innovation in this sector, which displays natural monopoly features, is becoming increasingly relevant. Measuring in novation is notoriously difficult, as both the inputs (funding innovative activities) and outputs (patents, publications or new adopted technologies and processes) are imprecisely measured and challenging to compare across countries. To address this, we take a text analysis approach to measuring innovation in DSOs, based on occurrences of innovation signaling words. Starting from a sample of 194 electricity DSOs and 73 gas DSOs, this paper measures innovation intensity based on DSO corporate reporting. The results are compared across different DSO characteristics like size, performance, structure, ownership and geographic location.

Keywords: Distribution System Operators; Energy Transition; Innovation (search for similar items in EconPapers)
JEL-codes: L94 (search for similar items in EconPapers)
Date: 2026-03-11
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