S U S T E L N E T Policy and Regulatory Roadmaps for the Integration of Distributed Generation and the Development of Sustainable Electricity Networks Martin Scheepers ECN The Netherlands Barcelona May Beta session 4b: Integration of RES+DG

2Barcelona May Beta session 4b: Integration of RES+DG Development of regulatory road maps for the transition to an electricity market and network structure that creates a level playing field between centralised and decentralised generation. Project Objective

3Barcelona May Beta session 4b: Integration of RES+DG Project Partners and Organisation The SUSTELNET project is carried out by a consortium of 10 European research institutes: The SUSTELNET project: is running in from beginning 2002 to mid 2004 has a research budget of € 1.7 million is supported by the European Commission under the 5 th RTD Framework Programme EU Member States: ECN, The Netherlands (co-ordinator) University of Warwick, UK Öko-Institut, Germany FEEM, Italy Tech-Wise, Denmark IZES, Germany New Associated States: Enviros, Czech Republic KAPE, Poland MAKK, Hungary EGU, Slovakia Other contributing organisations: Eindhoven University, The Netherlands Eltra, Denmark

4Barcelona May Beta session 4b: Integration of RES+DG Project Structure

5Barcelona May Beta session 4b: Integration of RES+DG The Policy Challenge

6Barcelona May Beta session 4b: Integration of RES+DG Institutional Changes Liberalisation of electricity markets results in: Introduction of market competition in electricity generation Unbundling of generation, network operations and supply Network regulation Current regulation often do not consider regulation of distribution networks to ensure effective participation of RES and DG in liberated electricity markets. In liberalised electricity market RES and DG are often: not or insufficiently rewarded for their benefits dependent on non-market based support schemes

7Barcelona May Beta session 4b: Integration of RES+DG DG Economics Cost priceRegulated feed-in tariff Commodity price Support (e.g. green certificates) environmental benefits sustainability goals technology support Market based pricing Compensation for electricity system benefits Today Cost priceMarket based pricing Future ( ) Support reduces only for externalities Electricity system benefits increases due to network innovates Creating a level playing field correct transfer of values between DG and network operators guaranteed market access for DG

8Barcelona May Beta session 4b: Integration of RES+DG Network Economics Regulated tariff Network Costs Today CAPEX (capital expenditures) OPEX (operational expenditures) Future ( ) Regulated tariff Network Costs Lower network tariffs due to performance based regulation DG electricity system benefits

9Barcelona May Beta session 4b: Integration of RES+DG Regulatory Road Maps towards a Sustainable Electricity System 2020 today implementation refinement integrated DG networks regulation period 2020 possible futures

10Barcelona May Beta session 4b: Integration of RES+DG Visit: Or For more information Thank you for your attention