Impact of reward and penalty scheme on the incentives for distribution system reliability

Alvehag, Karin; Awodele, Kehinde

doi:10.1109/pesgm.2014.6939244

Cited by 9 publications

(16 citation statements)

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“…As shown in the figure, the main parameters of RPS curves are the benchmark, dead bandwidth, incentive rate, reward cap, and penalty cap. The dead band is a zone around the benchmark in which neither the penalty nor reward is exposed [10]. Beyond this zone, whether a DISCO receives a bonus or incurs a penalty depends on the value of its quality index [21].…”

Section: Reward Penalty Schemementioning

confidence: 99%

“…In the same way, the slope of the line between the penalty point and penalty cap point is called the penalty ramp [12]. In many RPSs, the reward ramp and penalty ramp are equal, known as the incentive rate (IR) [10]. The value of the reward or penalty is also capped at a specific level in order to limit the financial risks associated with the RPS [12].…”

Section: Reward Penalty Schemementioning

confidence: 99%

“…As shown in Figure 3, the proposed scheme has two main parameters: the incentive rate and the reward cap. The value of the reward cap is usually considered as a percentage of the DISCO's annual revenue [10]. The incentive rate of this scheme can also be determined using Eq.…”

Section: Scheme 1: Designing the Rps Associated With Upstream Networkmentioning

confidence: 99%

“…As a result, it can be expected that employing such regulations will motivate the DISCOs to efficiently integrate DG units in order to improve the performance measures of their networks. To this end, we will take advantage of the reward penalty scheme (RPS) because distribution system regulators in many countries have adopted the RPS as an effective tool for regulating service quality [10].…”

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

Designing a regulatory framework for efficient integration of distributed generation technologies

Jooshaki¹,

Abbaspour²,

Fotuhi‐Firuzabad³

et al. 2017

Turk J Elec Eng & Comp Sci

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This paper focuses on the designing procedure of a regulatory framework in distribution networks with the main goal being to facilitate the integration of distributed generation (DG) units. The proposed framework is based on the concept of the reward penalty scheme (RPS) and creates effective financial incentives for distribution companies (DISCOs) in improving the quality of their services by applying DG units. To achieve this goal, reliability indices and annual energy losses of a distribution network are considered as two significant measures used in designing the structure of several RPSs. Employing these schemes, the regulators can quantify the quality of services provided by DISCOs. In order to examine the abilities of the proposed method, a case study on a test distribution system connected to bus 6 of the RBTS is performed. The obtained results show that a well-designed regulatory scheme can motivate DISCOs to adopt higher penetration of DG in such a way that their technical criteria can be improved.

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Section: Reward Penalty Schemementioning

confidence: 99%

Section: Reward Penalty Schemementioning

confidence: 99%

Section: Scheme 1: Designing the Rps Associated With Upstream Networkmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Designing a regulatory framework for efficient integration of distributed generation technologies

Jooshaki¹,

Abbaspour²,

Fotuhi‐Firuzabad³

et al. 2017

Turk J Elec Eng & Comp Sci

View full text Add to dashboard Cite

show abstract

“…Decision making behavior of a DisCo with the target of profit maximizing in the presence of PBR is analyzed in [12]. The authors in [13] proposed a method in order to design the RPS taking into account its effects on the DisCo's financial risk and their behavior, before enforcing the regulation.…”

Section: Introductionmentioning

confidence: 99%

A new reward-penalty mechanism for distribution companies based on concept of competition

Jooshaki

Abbaspour

Fotuhi‐Firuzabad

et al. 2014

IEEE PES Innovative Smart Grid Technologies, Europe

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In this paper, a new method for designing procedure of Reward-Penalty Scheme (RPS) in distribution system is proposed. Being fair and adoptable in viewpoint of distribution companies (DisCos) are main superiorities of the proposed RPS. Established based on concept of the Yardstick theory, its application can ensure regulators that a perfect competition will be created between DisCos to improve the service reliability. Also, such a regulation scheme can be a key for power system decision makers in order to prevent the DisCos from decreasing service reliability. Aimed to reach a fair mechanism, the proposed RPS rewards/penalizes the DisCos only compared with the other ones owning similar conditions. In this regard, Fuzzy C-means (FCM) clustering technique is applied to effectively categorize the similar DisCos into different groups. The average system reliability indices, i.e. System Average Interruption Frequency Index (SAIFI) and Expected Energy Not Supplied (EENS) are chosen as the comparison criteria in the proposed RPS. In order to illustrate efficiency of the proposed method, the proposed RPS is implemented on the Iranian electric power distribution sector to compare the abilities of different companies in reaching the predetermined goals.

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A hierarchical approach to designing an electricity distribution reward‐penalty scheme for service quality improvement

Ghasemi

Dashti

Amirioun

2021

Int Trans Electr Energ Syst

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In each regulatory period, the parameters of the reward and penalty scheme (RPS) vary based on the investment made by electricity distribution companies (EDCs) and imposed costs. In this paper, a novel dynamic model for determining the RPS parameters for each EDC is presented. This new model has three stages: (i) determination of the RPS parameters for the first regulatory period, (ii) the RPS decision-making model, and (iii) determination of the RPS parameters for the subsequent regulatory period. The proposed model was implemented for Iranian EDCs. Results verified the effectiveness of the proposed model in enhancing distribution system reliability.

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Impact of reward and penalty scheme on the incentives for distribution system reliability

Cited by 9 publications

References 0 publications

Designing a regulatory framework for efficient integration of distributed generation technologies

Designing a regulatory framework for efficient integration of distributed generation technologies

A new reward-penalty mechanism for distribution companies based on concept of competition

A hierarchical approach to designing an electricity distribution reward‐penalty scheme for service quality improvement

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