The regulation of distribution system operator is changing from the traditional approach to performance-based regulation (PBR). In this study a novel PBR approach is proposed for the regulation of a distribution company with consideration for asset management time scopes. In this regard a comprehensive separated regulation mechanism is presented so that the total expenditure for asset management is categorised into two: capital expenditure (Capex) and operational expenditure (Opex). A separate Capex and Opex regulation is proposed for electric distribution company regulation. A new reward and penalty scheme is proposed to efficiently regulate the quality of the network at a desirable level. The proposed methods are applied on the Iranian electricity distribution company.

Outage management has a crucial role in improving reliability level of distribution networks, and it is profoundly dependent on the reserve capacity margin of sub-transmission (ST) substations and load transferring capability between them. These factors enable distribution system operator (DSOs) to restore interrupted load points in out-of-service areas. In this study, the connection of reserve capacity in ST substations and load transferring capability, made by tie switches, is studied. The mentioned correlation is addressed via costumer interruption cost derived from outage management in primary distribution networks. Then, a mathematical model is developed in which optimal reserve capacity of ST substations and optimal placement of tie switches are determined simultaneously. The resulted optimisation model is formulated as a mixed-integer non-linear problem, and the genetic algorithm is used to solve the problem. Finally, the effectiveness of the proposed model is evaluated in a test distribution network.