2004 IEEE International Conference on Electric Utility Deregulation, Restructuring and Power Technologies (DRPT2004) April 2004 Hong
Kong
Comparison of Incentives for Distribution
System Reliability in Performance-Based
Regulation
T. Solver and L. Soder, Member, IEEE
Abstract-In recent years as many European electricity
markets are deregulated, Network Utilities are liberalized and
privatized. Consequently, the economic regulations of
Distribution Utilities, which is applied due to the monopoly
nature of network activities, have switched from cost-based
regulation to Performance Based Regulation (PBR). PBR gives
Distribution Utilities incentives to reduce costs. However,
increased cost efliciency may lead to decrements in distribution
quality, therefore is quality regulation necessary. In this paper
the basic outlines of Distribution Utility regulation in Sweden,
Norway, Spain and the Netherlands are compared. Focus in the
comparison Lie on the quality regulation framework and the
incentives brought upon the Distribution Utilities based on the
PBR-models’ framework.
Index Terms-Performance Based Regulation, Distribution
System Reliability, Power Quality, Quality of Supply.
1. INTRODUCTION
s. IGNIFICANT changes in form of liberalization and
. .
pnvatization have taken place in the electricity business.
While retail and generation is conducted on deregulated
competitive markets, transmission and distribution (T&D) is
still conducted on regulated markets due to the monopoly
characteristics of network activities. In many countries where
retail and generation are separated from T&D, regulation of
Distribution Grid Owners (DGOs) is in a major
transformation. Traditional cost-based regulation such as
Rate-of-Return (ROR) and Cost-Plus regulation is replaced by
the more competitive regulation concept known as
Performance Based Regulation (PBR) or Performance Based
Rating. Introducing PBR is usually the regulators’ way to
increase the cost efficiency of the regulated DGOs and to
safeguard the customers’ distribution quality. However the
stronger the cost efficiency incentives are the greater is the
need for quality regulation. The aim of this paper is to
compare and value the incentives brought upon the DGOs
through the quality regulation frameworks that are used in
The project is supponcd by the Ccnter of Competence in Elcctic Powcr
System and in pm by the Swedish Energy Agency and Elforsk AB.
Torbjijm Solver, Royal Instiate of Technology (KTH), Department of
Elccrricvl Engineering S-I00 44 Stockholm. Swedcn, (c-mail:
turbjom.rolvc~~ckc.kIli.sc), phonc: +46 8 790 7777. fax: +46 8 790 6510
Lennart SMa, Royal Institute of Technology (KTH),Dcpanment of
Electrical Engineering S-I00 44 Stockholm, Sweden, (e-mail:
lcoiiart.aodor~!ckc.kth.sc),phone: 146 8 790 8906, fax: +46 8 790 6510
0-7803-8237-4/04/$ I7.00020041EEE
485
1,
different approaches of PBR.
Needfir yualiry
regu/ation ? , ,
Cost-Plus
Incentives for
CDSI efficiewq
Fig. 1. Basic ovcrvicw ofDGO regulation methods.
11. PERFORMANCE
BASEDREGULATION
The need for a more or less advanced PBR-model is really a
case of limiting the regulators’ need for information. Would
the regulator have access to and be able to handle every bit of
information about the regulated part he would simply fix
prizes and quality standards [I]. This is not the case however,
and it’s safe to say that no regulation model is perfect.
Regulation gives the regulated part incentives to act in such
way that his or her situation becomes as profitable as possible.
Pricing schemes such as price caps or revenue caps removes
the link between actual cost and income and are therefore
widely used by regulators in order to give the DGOs
incentives for cost efficiency [l]. However, cost efficiency
improvements can have the opposite effect on the quality of
supply since distribution quality isn’t cost efficient on short-
term basis. For example, Argentina introduced PBR without
quality regulation in 1991. The quality of supply was strongly
degraded. Consequently, the PBR-framework had to be
complemented with quality regulation’ [2].
The aim of the PBR is to substitute a competitive market,
more specified the PBR-model must take the following
criterion into consideration [3]:
.
1
Give DGOs incentives to be economically efficiency.
Give DGOs incentives to uphold sufficient economic
reliability.
Give efficient DGOs opportunity to make sufficient
profits for wise grid investments.
1
Protect customers from being over charged.
Be fare, i.e. regulate the DGOs on equal terms.
’ Othcr countries such as Noway and England did not experience the
same phcnomena when introducing PER solely based on cost efficiency. This
might be enplaincd by bettcr distribution quality in general at thc time far the
PBR introduction.
2004 IEEE International Conference on Elecmc Utility Deregulation, Restruchlring and Power Technologies (DRPT2004) April 2004 Hong Kong

. The model should be cost efficient to implement.

Be transparent, i.e. regulate the DGOs on factors that
section
A . Swedish Regulation
can be determined externally.
The PBR-model framework can be divided into efficiency Sweden will introduce quality dependent revenue caps
regulation and quality regulation. regulation during 2004. Since Sweden is one of few countries
applying ex-post regulation the regulatoly period stated in the
A. Eficiency regulation beginning of 2003. Until 2003 the regulation applied on
Determining efficiency is a matter of comparing Swedish DGOs have been of cost based ROR-type. The PBR-
performance with cost. Efficiency regulation can be conducted model now introduced by the Swedish Energy Agency
through benchmarking of DGOs’ efficiency relative to that of (STEM) is called the Network Performance Assessment
other DGOs or a reference company. When benchmarking to model (NPAM). The basic idea of the NPAM is to regulate
other DGOs the comparison is usually made to the most the DGOs solely based on their Objective Criterion4. The
efficiency regulation is therefore conducted with respect to a
efficient similar DGO, which is referred to as the frontier shift
reference network that is constructed with the NPAM. The
or efficiency frontier. The method of comparing monopoly
reference grid is unique for each DGO and constructed based
utilities in order to substitute a competitive market is called
Yardstick competition [4]. -
on NPAM input data [5]:
Coordinates, energy consumption and revenue
The generic productivity improvement, expressed as
percentage, prescribed by the regulator .is usually called
general or generic X-factor. The individual revenue or price
-
generated to the DGO for each customer.
Coordinates of connections to other grids, energy
delivered into the grid, voltage level of these
reduction, expressed as percentage, which may be the result of connections and revenue or cost generated in the
various benchmarking is called individual X-factors. connection points.
Generic X-factors are usually set for periods of two to five 1 Revenue generated, energy delivered and voltage level
years in order to create transparency for the regulation model.
If the regulation framework is applied ex-ante2 the future
productivity have to be estimated and then corrected ex-post3.
.
of distributed generation.
Average outage frequency and duration separated into
announced and unannounced outages, i.e. SAlDI’ and
This can result in lagging of the individual X-factors SAIF~.
adjustments of one regulatory period of at least two years. The reference network is used to calculate the Network
Price or revenue caps are normally adjusted for inflation or Performance Assessment (NPA), which includes all necessary
Customer Price Index (CPI). expenses that the DGO should have in order to own, operate
and maintain the reference grid, i.e. the revenue cap.
B. Quality Regulation There is currently a discussion on how the Swedish quality
Except for Quality of Supply, Voltage and Commercial regulation should be conducted, one suggestion is that the
Quality might be included in quality regulation [2]. Even quality should be totally separated from the efficiency
though many countries have plans on including Voltage and regulation and measured as an index based on the relation
Commercial Quality in their PBR framework none of the between real outage cost and acceptable interruption costs.
countries in this paper have. Therefore, the quality regulation However, most likely is that the quality regulation will be
will only include Quality of Supply in this paper. In order to integrated in the NPAM in form of a reduction of the NPA,
register only permanent faults in their quality valuation, most which would be the difference between the real interruption
cost and the standardized interruption cost calculated for the
countries only include interruptions exceeding three minutes.
reference grid. If the standard interruption cost is higher than
Short interruptions (< 3 minutes) and transient faults are
the real one, no adjustment is made. The actual regulation is
matters of Voltage Quality.
conducted by looking at the ratios of each DGOs’ real revenue
The quality regulation can be conducted in reference to to its NPA, which is called their debiting rate. If the debiting
what the regulator defines as sufficient quality, which should rate is higher than one the customers are over charged for
be based with respect to the acceptable socio-economic distribution of electricity. Optimal debiting rate for a DGO is
interruption costs [ 5 ] , [6], [7], [SI. Should the interruptions therefore equal to one [5]. STEM has plans on including a
suffered by customers exceed the quality target, the generic X-factor on long-term basis, which would be the same
responsible DGOs are penalized through revenue or price cap as adjusting acceptable the debiting rate. However, the NPAM
reductions. In some quality regulations the DGOs are must be affective and tuned in first. The basic schematics of
rewarded for performing better than the reliability target. the NPAM are illustrated in fig. 2.

HI. PRACTICAL USE OF PBR-MODELS

FOR DGO REGUALTION
In this section four European PBR-models that either are
effective (2003) or planned to be in the near future are ‘
Tkhc DGOs Objective Criterion is defined as factors that t h e DGOs are
presented. These PBR-models are compared in the next not able to influence directly.
* SAID1 System Average Intemption Duration Index. = sum(Customer
intemmion durations) i Total number of customers served.
’Ex-ana, financial mlcs arc determinedin advance based on cxpecrations.
’ Ex-post. regulation is based on real financial accounts.

486
2004 IEEE International Conference on Electric Utility Deregulation, Restructuring and Power Technologies (DRPT2004) April 2004 Hong Kong

NPAM Economic Ekiieiency Data

divided into residentialiagriculture and industriaVcommercia1
* Interest Rates customers [7]. The estimation of ENS during an interruption is
* Depreciation Time calculated as the product of each interrupted customers
* Redundancy Factors
average hourly load and the duration of the interruption.
Components Reliability and
Maintenance Data C. Spanish Regulation
Spain started deregulating its electricity market in 1997. .At
Inputs Elciency
first only high-consuming’ customers were able to choose
Reiulation electricity supplier. The deregulation is planned to take place
gradually and by 2007 all customers will be able to choose
-
I Outagcratc Y
Debiting
electric energy supplier 121. The regulation of Spanish DGOs
is conducted according to what can be defined as a centralized
Outage Rate Rate PBR-model. Spanish National Energy Commission (CNE)
\ I %EZZ&nt differentiates the customers in six categories with respect to
their voltage level. The customers within each category are
Qnality charged according to a uniform distribution tariff, which is
Regulation
paid to CNE.
The DGOs receive remuneration from CNE for owning,
operating and maintaining the grid. The volume of the
NPAM Interruption Cost Data
remuneration is based on previous years’ remuneration, which
Fixed lntermptian Costs
Vaiablc Intemc&m Costs is corrected by market changes, general X-factor and inflation.
A crucial issue is therefore to determine the remuneration in
Fig. 2. Basic schematics of the NPAM. the starting year. According to the Spanish Electricity law
B. Norwegian Regulation 5411997 the method should not only be based on objective,
nondiscriminatory and transparent criterion, but also consider
From the deregulation of the Norwegian electricity market the geographic and market characteristics of each distribution
in 1991 until 1996 the Norwegian Water Resources and area 161. Methods for this are presented in [12].
Energy Directorate (NVE) used Cost-plus regulation on The quality regulation within the Spanish regulatory
Norwegian DGOs. In 1997 NVE introduced PBR in form of framework is conducted on customer and system level. If a
revenue caps. During the fust regulatory period the customer suffers more interruptions than pre-determined
Norwegian DGOs were regulated solely on their cost limits of interruption frequency and duration, he or she
efficiency. The efficiency regulation was conducted using receives a remuneration of five times the energy price of ENS
DEA-benchmarking, which compares input to output ratios of exceeding the pre-determined limits [6]. The remuneration is
similar DGO in order to determine the individual X-factors. paid by the DGOs. The interruption limits are differentiated
The inputs in the Norwegian DEA are: number of man labor by customer density and voltage level. For the high and
years, net losses, net assets and other operation expenses. medium voltage grids the DGOs are obliged to report
Together with the Outputs: delivered energy and the number interruption according to ASIFf, ASIDI’ and the 80
of connections. The DGOs are divided into groups based on percentile of ASIDI. Should the pre-determined levels of
environmental factors, i.e. network length and length of sea ASIFI, ASlDI and the 80 percentile of ASIDI be exceeded the
cable [9]. DGO must propose a quality improvement plan that have to
For the second regulatory period in 2001, quality dependent be approved by the Regional Administration. Should the plan
revenue caps were introduced. The efficiency regulation is be delayed or if the DGO fails to cany out the plan, the DGO
can be penalized. The DGO can be compensated with as much
performed in the same way as during the first period. The
as half of the costs for implementing the improvement plan
quality framework is regulated in the CENS-arrangement
[6]. Fig. 3 shows a simplified overview of the Spanish global
(Cost of Energy Not Supplied). Basically, the DGOs’ revenue
remuneration system.
cap is adjusted according to the difference between allowed
CENS and actual CENS [IO]. The CENS is estimated ex-ante
and corrected ex-post and has therefore impact on subsequent
year’s revenue. The DGOs’ estimated Energy Not Supplied
(ENS) is calculated using a regression model that basically
uses ENS data from the first regulatory period and adjusts it
with respect to delivered energy, grid extensions and weather
conditions. The regression model is described further in [ I l l .
The interruption costs used in the CENS-arrangement are ’Energy consumption greater than I GWh.
ASIFI: Systcm lntcrmption Frequency Indcx, Differs from SAlFl sincc
based on customer surveys performed in 1989 - 1991, which the average is wcightcd by installed capacity instead of by customer, and docs
are adjusted due to inflation. The costs within the CENS- not take LV intcmptions into account.
arrangement distinguish between announced and unannounced ’ ASIDI: System Intemption Duration Index. Diffcn from SAID1 sincc
the averagc is weighted by installcd capacity instead of by customer, and does
interruptions as well as customer category. The customers are not take LV intcmptions into account.

487
2004 IEEE International Conference on Electric Utility Deregulation, Restructuring and Power Technologies (DRPT2004) April 2004 Hong Kong
Remuneration for
t
Taiffs based on
Voltage Level
topoor quality on
Svstem Level
---_-----..
Remuneration due’L customers
to poor quality on
Customer Lcvel
Fig. 3. Overview ofthe Spanish global remuxeration system.
During the time the improvement plan is carried out, no
individual control will lead to compensation of customers.
These plans cannot last for more than two years [6].
D. Dutch Regulation
Before 2000, distribution tariffs in the Netherlands were set
according to a traditional Cost-Plus regulation system. In 2001
the Dutch Office for Energy Regulation (DTe) introduced
price caps as DGO regulation. During the first regulatory
period DTe regulated solely on cost efficiency, the
benchmarking was conducted using DEA, similar to the
efficiency regulation conducted in Norway. For the next
regulatory period, which probable will start in 2004 with a
two-year test period, DTe is planning to introduce quality
dependent price caps. The reason for introducing efficiency
prior to quality is an attempt to level out the DGOs efficiency
differences before starting to regulate on quality. During the
second regulatory period the efficiency regulation of Dutch
DGOs will be conducted using Total Factor Productivity
(TFP). TFP-benchmarking is based on the same fundamental
theory as DEA [13]. However, while DEA measures actual
efficiency, TFP measures the change in efficiency or
productivity. Estimation of the future productivity of the
frontier shift sets the generic X-factor. The efficiency frontier
consists of the DGOs that are considered fully efficient during
the first regulatory period. The difference between estimated
and real efficiency improvement is included in the subsequent
period, this way the DGOs performing better then average
frontier shift will be more profitable than those performing
worse than the efficiency frontier [SI, [13], thus a fictions
competitive market.
The quality regulation will be conducted based on DTe’s
definition of sufficient reliability. A reward or penalty will
affect the DGOs depending on their quality relative to the
suficient reliability level. The DGOs distribution quality will
be estimated ex-ante but corrected ex-post. DTe is planning to
define sufficient quality level using the reliability indices
SAIDI’’. Fig. 4 illustrates an example of Dutch quality
regulation [SI.
loThere haw been plans on also including CAlDI reliability index but
at the momcnt it’s leaning towards jut SAIDI..CAIDI = Customers Average
Intemption Duration Index = sum(Customcr interruption durations) I Total
numbcr of customer intermptions.
488
Reward
I Increased Rcliabilitv
‘ /
I
Sufficient j
Reliability ’
I
I’
LCVCl
Actual
Reliability
Penalty
Fig.4. Illustration of quality regulation
IV. COMPARISON
PBR-MODELS
To be able to discuss and compare the incentives brought
upon the regulated part due to a specific PBR-model, the
model parameters for comparison have to be structured. First,
.
the major similarities of included PBR-models are presented:
The PBR-models are or will be implemented in countries
with sufficient power quality, and the purpose of the
quality regulation is not to boost up the power quality
but to safeguard it from reductions.
1 The quality regulation is corrected ex-post, which is
rather natural since the regulation should regulate on
performance and not on estimated performance, which
could be incorrect and thereby give incorrect incentives.
The differences in quality regulation within the PBR-models
are however of main interest when comparing them. Hence,
seven parameters within in the quality regulations are
emphasized and emphasized and compared:
What’s included in ihe reliabilify measurement? The
Customers suffer in general higher costs due to many
rather short interruptions than due to few long ones, even
if the total duration time is equal [14]. Since one aim of
PBR is to give best economic distribution quality
possible. Not considering interruption frequency does
not optimize the quality regulation from a socio-
economic point of view.
How are the reliabilify indices weighted? Whether the
reliability indices are based on capacity or number of
customers can affect how the DGOs prioritize reliability
increasing investments. Weighing interruption indices by
capacity gives no distinct bias between high-density
urban areas and industrial intense areas, which is a risk
when the indices are based on number of intempted
customers where high-density areas can be favored”.
The total costs of interruptions for industrial customers
are in general higher than interruptions for commercial
and residential customers in urban areas, thus not socio-
economic optimal.
” Rural areas are generally of low priority udcss specific measures arc
taken in order to achieve political agendas.
2004 IEEE Intemational Conference on Electric Utility Deregulation, Restructuring and Power Technologies (DWT2004) April 2004 Hong Kong

3, Are there any factors that may decrease negative TABLE 1. COMPARlSON OF PARAMETERS WITHINTHEQUALIW REGUALTION
FRAMEWORK
incentives given by the weighting of the reliabiliry
indices? By measuring interruptions on different voltage
levels or by also including reliability indices weighted
with respect to interrupted customers. Parts of the
negative incentives due the weighing of the interruption
indices may he reduced to some extend.
4. How are the customers separated into categories? By
only distinguishing the customer categories with respect
to customer density the DGOs might he gives incentives
to favor urban areas in front of to industrial areas. This
may lead underestimated socio-economic interruption
costs due to lack of information. If the customers are
divided according to type it is more likely that the
interruption costs estimation is more accurate.
5 . Does the PBR-model regulale on both announced and
unannounced interruptions? In general customers
experience planned interruptions as less costly than
unannounced interruptions since the DGO can interrupt
the supply during hours that are less inconvenient to the
customers, industrial and commercial customers are able
to adapt production or activities accordingly. Still, the Thirdly, issues that affects the DGOs, when considering the
customers suffer costs due to planned interruptions, and basic outline of the total PBR-models’ framework, are
if planned interruptions are not included in the quality compared
framework the DGOs are not given any incentives to 8. How much of the maximum allowed revenue depends on
keep planned disconnections as short as possible. distri6ution qualiry? This is probably the single most
6 . Does the PBR-model distinguish between internal and important issue that gives incentive to the DGOs. If there
external faults? This is more a question of how the is little profit to he made in maintaining or increasing
Transmission Grid Owners (TGO) are regulated and how distribution quality the issue becomes less important to
DGOs can influence the upstream network. To the the DGOs. On the other hand if too much of the total
customers it’s of no interest whether the interruption was revenue depends on distribution reliability there is a risk
caused by DGO, TGO or other extemal part. If the that the customers are charged for distribution quality
DGOs suffer financially due to extemally caused they’re not willing to pay for or that DGOs can have
interruptions one can imagine that they are given difficulties to establish good distribution reliability due
incentives to demand better supply, hence better to lack of funds and not able to increase income due to
distribution quality for the customers in the long run. strict regulation, thus a classic moment 22.
I . On which voltage level are the interruption duration and 9. What is the regulator’s conduct code? Is the PBR-model
frequency determined? The most correct incentives are applied strictly or is it used as a tool for sorting out
given to the DGOs if all interruptions are included in the DGOs for further inspection. This is relevant since it
quality regulation. The closer to the customers that the affects the DGOs attitude towards the regulator and the
interruptions are determined the better is the outage regulation model. Un-strict application can tend towards
estimation from the customers’ point of view. However, a “give and take” relationship between regulator and
the accuracy in interruption data decreases if DGOs, which can increase the goodwill of the industly.
interruptions are determined in the low voltage grid due However, strict application of the regulation tends to
to the fact that DGOs don’t measure continuously on all give more cost efficiency incentives [3].
nodes in the low voltage system. 10.1s the eflciency regulationframework applied ex-ante or
Table 1 shows the PBR-model comparison based on the ex-post? From the regulators point of view ex-ante
parameters within the quality regulation fiamework. regulation is better if the DGOs misbehave since it’s

‘’ One should however be carehl in stating that thc doublc reliability

remumration framework gives inccntivcs to thc DGOs to maintain good
distnbutian quality since the DGOs can receive half of the funds entemally if
system reliability exceeds pre-determined vducs. Thc DGOs may therefore
stop maintenance until thcy prcscribed to by the regulator.
I’ Under thc condition that CAIDl is included as rcliability index.
I‘ Swedish DGOs are obliged to repon inlcrmptions at customer level but
only prescribed to measure thc cu~tomer~ supply on monthly basis, this can
lead to uncertainty in intemption reponing.

489
2004 IEEE International Conference on Electric Utility Deregulation,Restructuring and Power Technologies (DRPT2004) April 2004 Hong Kong

the Netherlands has very few rural areas, have no mountains

and is much smaller than the others might explain this. But
there are many other factors that are not considered in this
paper, e.g. pricing issues, ownership, business culture,
regulation history, and quality target strictness, etc.
The fact that are few countries who have long experience of
quality dependent revenue or price caps makes it rather
difficult to determine what long-term impact certain PBR-
models have on distribution quality. However, PBR-models
can be adapted to existing circumstances.

VII. REFERENCES
V. Ajcdhi, "Intcgrated P i c c and Reliability Regulation: The European
Experience", IEEE 0-7803-75254, pp 710 - 715,2002.
T. G 6 m q J. Rivier, "Distribution and Power Quality Regulation under
Electricity Competition. A Comparative SNdy", IEEE 0-7803-6499, pp
Sweden Norway Spain Holland 462 -468,2000.
H. Grtinli, '' A Comparison of Scandinavian R e g d a t ~ r yModels Issues
8. Quality Significant Significant Small Significant" and Expenencc", The Electricity Joumal, AugustiSeptembcr, pp 57-64,
fraction of mm1 2001.
rc"c""c'~ I I I A. Shieifer, "A Theory of Yardstick Compctitian", The RAND Joumal
9. Conduct 1 Un-strict 1 Strict I stnct I strict ofEeonomies,Vol. 16,No.3.pp319-327,1985.
ecde I M. Larsson, "The Nclwork Performance Assessment Model -
Regulation with a Reference Nelwork presented at thc Market Design
10. PBR Ex-post Ex-ante Ex-ante Ex-ante
implementation 2003 Conference, Stockholm. 16 - 17 June, 2003.
J. Rivier 7. Gbmcz, "Critical analysis of Spanish power quality
regulation design", prescntcd at the Markct Design 2003 Conference,
Stockholm, 16 17 June 2003.
~

J. Heggset, G. H. Kjallc, F. Trcngcreid, H. 0. Ween, "Quality of Supply

in Dercgulatcd Nanvcgian Power Systems", Presented at the IEEE Port0
Power Tcch Confercncc, 10 - I 3 Scptcmber 2001
V. Ajodhi, B. Franken. C. van der Lippc, "lntcgrated Regulation of Price
and Quality: the Dutch Expcricncc'. prcscntcd at the Market Design
2003 Canfercncc, Stockholm, 16 - 17 June, 2003.
T. E. Grammeltvedt, "DEA-Analysis - Can they be Used in Regulation?
Pros and Cons From Five Years' Expcricnccs in Norway", presented at
the Market Desien 2003 Canfcrcnce, Stockholm, 16 17 June. 2003.
~

[IO] T. Langset, F. frengereid, K. Samdal, J. Heggset, "Quality Depcndcnt

Revenue Caps - A model For Quality Of Supply Regulation", Presented
at CIRED'OI, Amsterdam, The Netherlands, 2001.
[Ill ECON. "A Madcl for Estimation of Expected Energy Not Supplied".
Report nr. 59/00, 2000 (in N ~ ~ c g i a n ) .
[I21 J. Rombn, T. Gomez, A Mufiar, 1. Pcco, "Regulation of distnbutian
network business" IEEE Transactions on Power Delivcry, Vol 14 No. 2,
pp 662 - 669, April 1999.
[I31 "Yardstick competition Rcgional Electricity Ncwork Companies,
Second Regulatory Period", DTc, information and consultation
document, 20 November 2002.
[I41 SVEL-94 "lntcmplion cost for elcctricily Customers", ISDN 901 7622
096-6, Svenska Elvcrksfbmingen. 1994 (in Swcdish).
[IS] Council of European Regulators (CEER), "Quality of Elccmcity Supply:
Ilutial Ben~hmarking on AcNal Lcvels. Standards and Regulatoni
Strategies.

VIII. BIOGRAPHIES
Torbjlrn Solver was bom in Varberg, Sweden in 1974, HC reccivcd his
MSc. degree in Energy Engineering from the University of Ume4 Sweden in
2002. He is cummtly a PhD shldent in Electric Power System at the Royal
InStiNtC of Technology (KTH).

'I Subjective judgment by thc author; a small fraction means less than 5 %
and significant means between 5 and 10 % o f the total revenue.
'' Estimated based on the fact that Holland generally has very short
intcrmptian timcs, and in order to safcguard that need significant reliability
remuneration.
Lennart Sldcr (M' 91) was bam in S o h , Swcdcn in 1956. He received his
M.Sc. and Ph.D. degrees in Electrical Engineering from the Royal Institllte of
Technology, Stockholm, Sweden in 1982 and 1988 respectively. He is
currently a professor in Electric Power Systems at the Royal Institute of
Technology (KTH). Hc also works with prajccts conccming dcrcgulatcd
clcctricity markeu and integration of wind powcr.

490