Analyzing Supply Reliability Incentive in Pricing Regulation of Electricity Distribution Operators

Joel Seppälä () and Pertti Järventausta
Additional contact information
Joel Seppälä: Unit of Electrical Engineering, Tampere University, Korkeakoulunkatu 7, FI-33720 Tampere, Finland
Pertti Järventausta: Unit of Electrical Engineering, Tampere University, Korkeakoulunkatu 7, FI-33720 Tampere, Finland

Energies, 2024, vol. 17, issue 6, 1-17

Abstract: In support of the global green transition, numerous policies have been introduced to efficiently address the increasing demand for reliable electricity. However, the impacts of these policies have received limited attention, despite the potential for unsuccessful policy targets to introduce inefficiencies into the energy system, subsequently diminishing societal wealth. This study bridges this research gap by conducting a comprehensive examination of a supply reliability incentive within electricity pricing regulation, aiming to contribute new insights for policy assessments. Analyzing data from all electricity distribution operators within a single jurisdiction, the study investigates the volume and distribution of economic steering to elucidate the overall societal impact. The findings suggest a rewarding system for positive developments in indices, regardless of the absolute interruption index levels, highlighting the importance of precise variable definitions in implementing incentive mechanisms. The assessment tools developed for this study will be valuable for further regulation and policy assessments.

Keywords: electricity distribution; economic regulation; security of supply; clustering (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/1996-1073/17/6/1451/pdf (application/pdf)
https://www.mdpi.com/1996-1073/17/6/1451/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jeners:v:17:y:2024:i:6:p:1451-:d:1358858

Access Statistics for this article

Energies is currently edited by Ms. Agatha Cao

More articles in Energies from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().