Developing a New Risk Assessment Methodology for Distribution System Operators Regulated by Quality Regulation Considering Reclosing Time

Abstract

-In the restructured electricity market, Performance-Based Regulation (PBR) regimehas been introduced to the distribution network. To ensure the network stability, this regime is used along with quality regulations. Quality regulation impose new financial risks on distribution system operators (DSOs). The poor quality of the network will result in reduced revenues for DSOs. The mentioned financial risks depend on the quality indices of the system. Based on annual variation of these indices, the cost of quality regulation will also vary. In this paper with regard to reclosing fault in distribution network, we develop a risk-based method to assess the financial risks caused by quality regulation for DSOs. Furthermore, in order to take the stochastic behavior of the distribution network and quality indices variations into account, time-sequential Monte Carlo simulation method is used. Using the proposed risk method, the effect of taking reclosing time into account will be examined on system quality indicators and the cost of quality regulation in Swedish rural reliability test system (SRRTS). The results show that taking reclosing fault into consideration, affects the system quality indicators, particularly annual average interruption frequency index of the system (SAIFI). Moreover taking reclosing fault into consideration also affects the quality regulations cost. Therefore, considering reclosing time provides a more realistic viewpoint about the financial risks arising from quality regulation for DSOs.

Cubic reward penalty structure for power distribution companies

“…Later on as compared to the performance-based regulation, Latify et al (2013) used energy based reliability index (EIR) such as EENS instead of the common system reliability indices for evaluating the reliability and assigned rewards/penalties to the distribution companies. Saboorideilami and Abdi (2014) developed a risk-based method using time-sequential Monte Carlo simulation method, to assess the financial risks caused by quality regulation for power distribution companies, to take the stochastic behavior of the distribution network and quality indices(SAIFI, SAIDI, and CAIDI) variations. Based on the concept of Yardstick theory as compared to the Monte Carlo simulation method used by Saboorideilami and Abdi (2014), Jooshaki (2014) have designed reward/penalty structure based on AENS and SAIFI for power distribution companies using Fuzzy C-means algorithm, which ensure regulators to improve the service reliability by creating a perfect competition between distribution systems.…”

“…To excuse the cost of reserve funds in maintenance and investment, that will compel the decay of system reliability, a method known as, Performance-Based Regulation (PBR), has been presented and includes the objective of maintaining a balance of service reliability and the utility expenses a key issue in today's energy market. PBR is an agreement that rewards a utility for providing great reliability and/or punishes a utility when the inverse happens Saboorideilami and Abdi 2014). This infers the penalties are expanded as the performance deteriorates.…”

“…Quality control is connected in three distinct concepts: commercial quality, continuity of supply (reliability) and voltage quality (Saboorideilami and Abdi 2014). Amongst these three continuity of supply (reliability) is of significant importance (Larimi et al 2016;Saboorideilami and Abdi 2014).…”

“…In this paper, the main focus has been on the effect of quality regulation upon the continuity of supply (basically reliability) (Saboorideilami and Abdi 2014). PBR (Saboorideilami and Abdi 2014) depends upon the service remuneration costs concerned with the competitive method used for quality regulation, in light of penalties.…”

“…Quality regulation is applied in three regions: commercial quality, continuity of supply and voltage quality. Among which continuity of supply is of greater significance (Saboorideilami and Abdi 2014;Ajodhia and Hakvoort 2005). This paper only considers the effect of quality regulation on continuity of supply (reliability).…”