Regulatory Analysis for Distributed Generation and Demand-Side Participation Integration

PROYECTO FIN DE CARRERA
Regulatory analysis for the integration of
Distributed Generation and Demand-Side
Participation
AUTOR: Breogán Pardo Álvarez
DIRECTOR: David Trebolle Trebolle
MADRID, Mayo 2013
UNIVERSIDAD PONTIFICIA COMILLAS
ESCUELA TÉCNICA SUPERIOR DE INGENIERÍA (ICAI)
INGENIERO INDUSTRIAL

AUTORIZACIÓN PARA LA DIGITALIZACIÓN, DEPÓSITO Y DIVULGACIÓN EN ACCESO
ABIERTO ( RESTRINGIDO) DE DOCUMENTACIÓN
1º. Declaración de la autoría y acreditación de la misma.
El autor D. Breogán Pardo Álvarez, como alumno de la UNIVERSIDAD PONTIFICIA COMILLAS
(COMILLAS), DECLARA
que es el titular de los derechos de propiedad intelectual, objeto de la presente cesión, en
relación con la obra Proyecto Fin de Carrera “Análisis Regulatorio para la implementación de la
GD y la Participación Activa de la Demanda1
, que ésta es una obra original, y que ostenta la
condición de autor en el sentido que otorga la Ley de Propiedad Intelectual como titular único
o cotitular de la obra.
En caso de ser cotitular, el autor (firmante) declara asimismo que cuenta con el
consentimiento de los restantes titulares para hacer la presente cesión. En caso de previa
cesión a terceros de derechos de explotación de la obra, el autor declara que tiene la oportuna
autorización de dichos titulares de derechos a los fines de esta cesión o bien que retiene la
facultad de ceder estos derechos en la forma prevista en la presente cesión y así lo acredita.
2º. Objeto y fines de la cesión.
Con el fin de dar la máxima difusión a la obra citada a través del Repositorio institucional de la
Universidad y hacer posible su utilización de forma libre y gratuita ( con las limitaciones que
más adelante se detallan) por todos los usuarios del repositorio y del portal e-ciencia, el autor
CEDE a la Universidad Pontificia Comillas de forma gratuita y no exclusiva, por el máximo plazo
legal y con ámbito universal, los derechos de digitalización, de archivo, de reproducción, de
distribución, de comunicación pública, incluido el derecho de puesta a disposición electrónica,
tal y como se describen en la Ley de Propiedad Intelectual. El derecho de transformación se
cede a los únicos efectos de lo dispuesto en la letra (a) del apartado siguiente.
3º. Condiciones de la cesión.
Sin perjuicio de la titularidad de la obra, que sigue correspondiendo a su autor, la cesión de
derechos contemplada en esta licencia, el repositorio institucional podrá:
(a) Transformarla para adaptarla a cualquier tecnología susceptible de incorporarla a internet;
realizar adaptaciones para hacer posible la utilización de la obra en formatos electrónicos, así
como incorporar metadatos para realizar el registro de la obra e incorporar “marcas de agua”
o cualquier otro sistema de seguridad o de protección.
(b) Reproducirla en un soporte digital para su incorporación a una base de datos electrónica,
incluyendo el derecho de reproducir y almacenar la obra en servidores, a los efectos de
garantizar su seguridad, conservación y preservar el formato. .
1
Especificar si es una tesis doctoral, proyecto fin de carrera, proyecto fin de Máster o cualquier otro
trabajo que deba ser objeto de evaluación académica

(c) Comunicarla y ponerla a disposición del público a través de un archivo abierto institucional,
accesible de modo libre y gratuito a través de internet.2
(d) Distribuir copias electrónicas de la obra a los usuarios en un soporte digital. 3
4º. Derechos del autor.
El autor, en tanto que titular de una obra que cede con carácter no exclusivo a la Universidad
por medio de su registro en el Repositorio Institucional tiene derecho a:
a) A que la Universidad identifique claramente su nombre como el autor o propietario de los
derechos del documento.
b) Comunicar y dar publicidad a la obra en la versión que ceda y en otras posteriores a través
de cualquier medio.
c) Solicitar la retirada de la obra del repositorio por causa justificada. A tal fin deberá ponerse
en contacto con el vicerrector/a de investigación (curiarte@rec.upcomillas.es).
d) Autorizar expresamente a COMILLAS para, en su caso, realizar los trámites necesarios para
la obtención del ISBN.
d) Recibir notificación fehaciente de cualquier reclamación que puedan formular terceras
personas en relación con la obra y, en particular, de reclamaciones relativas a los derechos de
propiedad intelectual sobre ella.
5º. Deberes del autor.
El autor se compromete a:
a) Garantizar que el compromiso que adquiere mediante el presente escrito no infringe ningún
derecho de terceros, ya sean de propiedad industrial, intelectual o cualquier otro.
b) Garantizar que el contenido de las obras no atenta contra los derechos al honor, a la
intimidad y a la imagen de terceros.
c) Asumir toda reclamación o responsabilidad, incluyendo las indemnizaciones por daños, que
pudieran ejercitarse contra la Universidad por terceros que vieran infringidos sus derechos e
intereses a causa de la cesión.
d) Asumir la responsabilidad en el caso de que las instituciones fueran condenadas por
infracción de derechos derivada de las obras objeto de la cesión.
2
En el supuesto de que el autor opte por el acceso restringido, este apartado quedaría redactado en los
siguientes términos:
(c) Comunicarla y ponerla a disposición del público a través de un archivo institucional, accesible de
modo restringido, en los términos previstos en el Reglamento del Repositorio Institucional
3
En el supuesto de que el autor opte por el acceso restringido, este apartado quedaría eliminado.

6º. Fines y funcionamiento del Repositorio Institucional.
La obra se pondrá a disposición de los usuarios para que hagan de ella un uso justo y
respetuoso con los derechos del autor, según lo permitido por la legislación aplicable, y con
fines de estudio, investigación, o cualquier otro fin lícito. Con dicha finalidad, la Universidad
asume los siguientes deberes y se reserva las siguientes facultades:
a) Deberes del repositorio Institucional:
- La Universidad informará a los usuarios del archivo sobre los usos permitidos, y no garantiza
ni asume responsabilidad alguna por otras formas en que los usuarios hagan un uso posterior
de las obras no conforme con la legislación vigente. El uso posterior, más allá de la copia
privada, requerirá que se cite la fuente y se reconozca la autoría, que no se obtenga beneficio
comercial, y que no se realicen obras derivadas.
- La Universidad no revisará el contenido de las obras, que en todo caso permanecerá bajo la
responsabilidad exclusiva del autor y no estará obligada a ejercitar acciones legales en nombre
del autor en el supuesto de infracciones a derechos de propiedad intelectual derivados del
depósito y archivo de las obras. El autor renuncia a cualquier reclamación frente a la
Universidad por las formas no ajustadas a la legislación vigente en que los usuarios hagan uso
de las obras.
- La Universidad adoptará las medidas necesarias para la preservación de la obra en un
futuro.
b) Derechos que se reserva el Repositorio institucional respecto de las obras en él registradas:
- retirar la obra, previa notificación al autor, en supuestos suficientemente justificados, o en
caso de reclamaciones de terceros.
Madrid, a 31 de mayo de 2013
ACEPTA
Fdo……………………………………………………………

Proyecto realizado por el alumno/a:
Breogán Pardo Álvarez
Fdo.: …………………… Fecha: ……/ ……/ ……
Autorizada la entrega del proyecto cuya información no es de carácter confidencial
EL DIRECTOR DEL PROYECTO
David Trebolle Trebolle
Fdo.: …………………… Fecha: ……/ ……/ ……
Vº Bº DEL COORDINADOR DE PROYECTOS
Prof. Dr. Fernando de Cuadra García
Fdo.: …………………… Fecha: ……/ ……/ ……

PROYECTO FIN DE CARRERA
Regulatory analysis for the integration of
Distributed Generation and Demand-side
participation
AUTOR: Breogán Pardo Álvarez
DIRECTOR: David Trebolle Trebolle
MADRID, Mayo 2013
UNIVERSIDAD PONTIFICIA COMILLAS
ESCUELA TÉCNICA SUPERIOR DE INGENIERÍA (ICAI)
INGENIERO INDUSTRIAL

I
ANÁLISIS REGULATORIO PARA LA IMPLEMENTACIÓN DE LA
GENERACIÓN DISTRIBUIDA Y LA PARTICIPACIÓN ACTIVA DE
LA DEMANDA.
Autor: Pardo Álvarez, Breogán.
Director: Trebolle Trebolle, David.
Entidad Colaboradora: Unión Gas Natural Fenosa.
RESUMEN DEL PROYECTO
El proceso de liberalización y separación de actividades del sector eléctrico que empezó
en la década de los 90 en la mayoría de los países europeos, ha supuesto un cambio en
su estructura. Generación, mercados eléctricos (mercados mayorista y minorista) son
actividades liberalizadas, mientras que las actividades de red (transporte y distribución),
gestión técnica y operador del mercado (si existe) permanecen como actividades
reguladas.
Todas las actividades del sector eléctrico se agrupan en cuatro grupos: capa física,
gestión técnica, actividades económicas y marco regulatorio. Esta división es importante
a la hora de entender el análisis presentado en este proyecto.
En los últimos años, la concienciación del impacto medioambiental debido a la
actividad humana, la dependencia exterior de la UE de materias primas (combustibles
fósiles) y la insostenibilidad de los sistemas energéticos han motivado cambios en las
políticas energéticas. Un ejemplo de ello son los objetivos 20/20/20 para el 2020 que
tratan de solucionar los problemas que se acaban de mencionar.
Dentro de la demanda energética de un país, el sistema eléctrico supone una gran
proporción de dicha demanda. Por ello, se requiere que el sistema eléctrico se desarrolle
de una manera más inteligente y activa evolucionando hacia las “Redes Eléctricas
Inteligentes”.
Las redes eléctricas inteligentes son la evolución del sistema eléctrico actual, son el
proceso de integración de los Recursos Energéticos Distribuidos (RED) al mismo
tiempo que se mejora la calidad, eficiencia y seguridad del suministro. Los RED son:
Generación Distribuida (GD), Participación Activa de la Demanda (PAD), Vehículo
eléctrico y almacenamiento descentralizado. Complementariamente, es imprescindible
un adecuado desarrollo tecnológico y marco regulatorio para la buena integración de los
RED.
Hay dos aspectos muy importantes a considerar:
 Las redes inteligentes son un proceso de integración de los RED, por lo que no
suponen un tipo totalmente nuevo de redes con activos de red que descarten a los
actuales. Como todo proceso de evolución, las redes inteligentes tienen una hoja de
ruta en la que algunos RED han de integrarse antes que otros.
 Los RED debido a sus características, son activos que se conectarán a la red de
distribución, en consecuencia, estas redes juegan un papel fundamental en la
evolución de las redes inteligentes.
Actualmente, la integración de los RED está suponiendo grandes retos para los
distribuidores que suponen un impedimento para su adecuada integración.

II
Generación Distribuida (GD)
Se considera generación distribuida (GD) aquellos sistemas de generación eléctrica
conectados a la red de distribución, caracterizados por su poca potencia y por estar
conectados cerca del consumo final.
Sólo bajo ciertas hipótesis, la GD puede reducir las pérdidas eléctricas, retrasar las
inversiones del Operador del Sistema de Distribución (OSD) en la red y mejorar la
seguridad de suministro. Sin embargo, la realidad es otra muy distinta.
En los últimos años, las Autoridades Regulatorias Nacionales (ANR) de Europa han
llevado a cabo planes de incentivos para la GD de carácter renovables. Estos incentivos
se otorgaron a las energías renovables por:
 Alto coste medio de producción de energía: las renovables hace pocos años
estaban en sus inicios y por tanto, eran tecnologías inmaduras incapaces de competir
en los mercados eléctricos. Actualmente, algunas tecnologías renovables (eólica
terrestre y geotérmica) presentan unos costes comparables a las tecnologías
convencionales.
 Su naturaleza intermitente e impredecible hacen muy difícil su participación en
los mercados eléctricos.
Estos dos factores unidos hicieron que la GD renovable (que supone una parte
importante de la GD) obtuviera ayudas como: prioridad de acceso y mecanismo de
ayudas económicas (tarifas feed-in, cuotas + certificados verdes, etc.). Las
consecuencias de dichas ayudas han sido que:
 GD renovable no participe en los mercados eléctricos y el DSO no reciba ninguna
información sobre la potencia que inyecta la GD en sus redes.
 GD renovables pueden inyectar potencia en la red a cualquier hora del día sin tener
en cuenta el estado de la red a la que se conectan.
En cuanto a la planificación, el principal problema de la GD es su falta de firmeza
(capacidad de un grupo generador para inyectar/absorber potencia cuando el sistema lo
requiere). Por este motivo, los OSD no pueden confiar en la capacidad de la GD y
planifican redes sin tener la GD en cuenta, resultando en sistemas sobredimensionados.
Respecto a la operación, la integración de la GD (cargas impredecibles y flujos de
potencia bidireccional) en las redes de distribución, requiere que los OSD pasen de una
operación pasiva a una operación más activa y flexible. La GD tiene principalmente dos
efectos negativos.
En primer lugar, en las redes de MT y BT, la potencia activa inyectada por la GD
produce grandes variaciones de tensión, afectando a la calidad del producto final para el
cliente. Para compensar dicho efecto es necesario controlar los flujos de potencia
reactiva. Sin embargo, en líneas de MT y BT el efecto de la potencia reactiva sobre la
tensión es mucho menor que el de la potencia activa.
En segundo lugar, puede haber congestiones en el sistema (PG-PL>Pmáx) que lleven al
sistema fuera de la operación segura. Como se mencionó antes, esto es debido
principalmente a la ausencia de incentivos para que la GD considere el estado de
operación, a nivel local, de la red a la que se conecta.

III
En lo que respecta a la forma de conexión y acceso de la GD, es necesario abandonar el
método tradicional de “Fit and forget” (sólo se analiza el impacto de la GD en la
planificación y acceso firme) y avanzar hacia una “Gestión activa” (considera el
impacto de la GD en la planificación y luego en la operación, puede o no tener acceso a
la red) ya que es la solución más económica y eficiente.
Dentro de la conexión de la GD existen los siguientes problemas:
 Criterios técnicos de conexión: criterios de protecciones eléctricas no adecuados, la
no posibilidad de usar cargos por conexión semidirectos en vez de los cargos por
conexión profundos.
 Ausencia de transversalidad a nivel nacional, falta de estandarización, falta de
transparencia, criterios discriminatorios de algunos generadores respecto de otros.
Debido al “fit and forget”, la GD tiene acceso firme a la red. Si la GD genera cuando el
sistema está al límite de la operación segura, puede provocar apagones y cortes de
suministro que reducen así la fiabilidad del mismo.
Además de todo lo anterior, OSD necesitan integrar en sus redes las TICs para mejorar
la monitorización de sus redes y establecer comunicaciones bidireccionales con la GD.
Participación Activa de la Demanda (PAD).
El término de PAD se usa como un concepto que engloba otros dos:
 Gestión Activa de la Demanda (GAD): es la implementación de todas aquellas
medidas (por parte de los OSD) que tratan de influenciar la manera en que se
consume la energía, obteniendo los cambios deseados en la curva de la demanda.
Estas medidas se pueden clasificar en cuatro grupos: mejorar la eficiencia del
sistema, trasladar demanda de los picos a los valles, rellenar los valles y reducir la
demanda en momentos críticos para el sistema.
 Respuesta de la demanda (RD): se refiere a los cambios en los hábitos de consumo
de los consumidores finales debidos a las variaciones de las señales de precios a lo
largo del tiempo.
La demanda de cualquier sistema eléctrico está caracterizada por: comportamiento
estacional, relación entre picos y valles, eventos especiales, dispersión geográfica de la
generación y la demanda, tipo de demanda (industrial, servicios y consumo doméstico)
e inelasticidad. La inelasticidad de la demanda impide la integración de la RD. Esto se
debe a dos factores:
 El cliente final carece de información acerca del precio real de la electricidad. Para
subsanar esto, es necesario que el cliente final pueda recibir señales de precio.
 Gran parte de la demanda (pequeñas industrias, servicios y consumos domésticos)
presentan tarifas reguladas con precios más o menos constantes, siendo necesario
integrar contratos que reflejen el precio de la electricidad en los mercados eléctricos.
Estos dos factores hacen que el cliente final no sea consciente de los precios finales y
carezcan de incentivos para adaptar su consumo según los precios del mercado y el
estado del sistema.
Desde el punto de vista de la planificación, el DSO debe procurar firmeza en la
demanda (reducir o parar su consumo cuando el sistema lo requiere) para poder retrasar

IV
sus inversiones en refuerzos de red, mejorando la utilización de los activos existentes.
En cuanto a la operación, la RD puede ayudar a gestionar congestiones cuando haya
exceso de demanda.
Además de todo esto, la adecuada integración y coordinación de la GD y la PAD, los
OSD deben desarrollar herramientas para mejorar su monitorización, previsión de
demanda, simulación y control de sus redes.
Modelo regulatorio propuesto: soluciones para la integración de la GD y la
PAD dentro del marco de las Redes Eléctricas Inteligentes.
En la planificación, los OSD necesitan mejorar la firmeza de la demanda y de la GD.
Para este propósito, las ANR deben definir los mercados de gestión de capacidad
firme para incentivar dicha firmeza de la GD y de la demanda.
Dentro de los mercados de gestión de firmeza de capacidad hay dos tipos de mercados:
los de firmeza de la GD y los de firmeza de la demanda. Gracias a la firmeza obtenida
en estos mercados, los OSD pueden obtener capacidad extra de la GD o reducir la
capacidad de la demanda (a través de comercializadoras y grandes consumidores) en
aquellos momentos en los que la red, localmente, vaya a estar sobrecargada. De esta
manera los OSD podrán retrasar las inversiones de refuerzo de la red.
Estos mercados deberían ser coordinados por los OSD, ya que son los que mejor
conocen el funcionamiento de sus redes. Habrá tantos mercados como áreas en las que
dividan los OSD sus redes, ya que estos mercados son locales.
Los OSD establecerán estos mercados con un plazo mínimo de un año, basándose en
sus previsiones de demanda para ese periodo de un año. Por ello, deben determinar las
áreas y el número de horas que se espera que el sistema esté sobrecargado. El uso de
este servicio debería ser ex-post, de manera que el OSD sólo pague por este servicio a la
GD, comercializadoras y/o grandes consumidores cuando haga uso de él y al precio
establecido en estos mercados. Los OSD pagarán por estos servicios (OPEX) hasta el
momento en el que investir en refuerzos (CAPEX) a largo plazo sea lo más
económicamente eficiente.
Respecto a la filosofía de conexión y acceso de la GD, los OSD tienen que evolucionar
hacia una “Gestión Activa” (conexión y acceso no firmes) que busca la solución más
económica para el corto y el largo plazo. Los OSD deberían incentivar que la GD acepte
estos contratos de acceso variable a cambio de beneficios económicos en la conexión
(usar cargos por conexión semidirecta en vez de cargos por conexión profundos). Estos
contratos permitirán a los OSD restringir la inyección de potencia de la GD cuando el
sistema esté congestionado durante la operación.
Para la conexión de la GD, las ARN deberían definir criterios de protección adecuados
para cada tecnología, evitando la desconexión de GD ante perturbaciones en la red,
recomendándose el uso de estándares internacionales como las normas UNE o IEC. Las
ARN deberían permitir que los OSD ofrezcan a la GD cargos por conexión semidirecta
para incentivar su apoyo en la operación y planificación a través de los servicios de
sistema (firmeza, control de tensión, compensación de pérdidas, etc.). Además, las
ANR deberían establecer como obligatorio la implantación de las TICs para establecer
comunicaciones entre OSD y GD.

V
En cuanto al acceso y conexión de la demanda, sólo destacar que en la conexión es
imprescindible el establecer programas de implementación gradual de los contadores
inteligentes para todos los consumidores finales.
En lo referente a la operación, las ARN deberían definir tres estados distintos de
operación del sistema:
 Estado normal: el sistema está dentro de los límites de operación segura.
 Estado de alerta: la curva de demanda acordada en el mercado mayorista puede
provocar congestiones, variaciones de tensión y otros problemas a nivel local que
requieren la utilización de servicios de sistema. Estos servicios de sistema
proporcionados por los RED, serán coordinados mediante mercados por los OSD.
 Estado de emergencia: el sistema ha pasado los límites de operación segura y
requiere la intervención inmediata de los OSD para solventar los problemas cuanto
antes.
Los OSD utilizarán los servicios de sistema para pasar de los estados de alerta o
emergencia al estado normal. Las ANR deben crear dichos servicios de sistema.
Además, para que OSD puedan coordinar los RED y los servicios de sistema que
proporcionan, los OSD necesitan invertir en TICS, creación de los mercados de
servicios de sistema y herramientas de monitorización, simulación, previsión de carga y
control.
Las ARN deberían considerar los OPEX y CAPEX derivados de la implementación de
las TICs, mercados de servicios de sistema y nuevas herramientas para los OSD. Por
ello, las ANR deberían desarrollar una regulación por incentivos de los OPEX y los
CAPEX. Al mismo tiempo será imprescindible la definición de indicadores que
controlen el grado de implementación y variables económicas de las nuevas soluciones
en el caso de los CAPEX e indicadores de calidad, eficiencia, seguridad y variables
económicas en el caso de los OPEX.
Las ayudas para la integración de nuevas tecnologías en la GD deben procurar el
desarrollo tecnológico al mismo tiempo que se procura limitar la inserción a gran
escala de tecnología inmadura en los sistemas de distribución. Para conseguir esto, las
ANR deberían determinar una cantidad fija de presupuestos para estas ayudas. En
segundo lugar, deberían repartir dicha cantidad de manera que: tecnologías inmaduras
reciban una menor proporción del total, pero que esa cantidad se reparta entre menos
proyectos (limita el número de proyectos). Por el contrario, tecnologías más maduras
recibirán una mayor proporción del total, pero se repartirá entre más proyectos.
Finalmente, las ANR tienen que decidir si las ayudas las obtienen de la tarifa de acceso
o si las obtienen a través de los Presupuestos Generales del Estado. Ambas opciones
tienen consecuencias negativas a corto plazo, pero son imprescindibles para la
competitividad del país a largo plazo.
Para la integración de la respuesta de la demanda hay dos elementos clave: contratos
basados en precios del mercado y señales de precios a través de contadores inteligentes.
Las comercializadoras deben crear productos atractivos para sus clientes objetivo, de
manera que de forma voluntaria abandonen los contratos regulados. Además, los
consumidores finales pueden obtener beneficios si trasladan su consumo a momentos de
menor demanda o cuando el sistema lo requiera (incentivos de los mercados de
firmeza).

VII
REGULATORY ANALISYS FOR THE INTEGRATION OF
DISTRIBUTED GENERATION AND DEMAND-SIDE
PARTICIPATION.
Summary of the dissertation.
The de-regulation and unbundling process of the electrical sectors that started in the
90’s in most of European countries, has change their structure. Generation, economic
activities (wholesale and retail markets) are de-regulated activities, while network
activities (transmission and distribution), technical operation and market operator (when
it exists) are regulated activities.
The activities involved in the electrical sector can be divided in four groups: physical
layer, technical management layer, economic activities and regulatory framework. This
separation is essential for the analysis of the smart grids presented in this dissertation.
In recent years, the awareness about the environmental impact derived from human
activities, the external fossil fuel’s dependence of Europe and the unsustainability of the
energy system have motivated changes in the energy policies of the EU. As a result of
this tendency, new milestones such as the objectives 20/20/20 for 2020 try to solve the
three aforementioned issues.
The electrical systems represent an important share of the energetic demand of any
country; thereafter, changes in the electrical systems are required if the EU wants to
achieve its objectives. In order to face these new challenges, the electrical systems must
be developed with a smarter and more active approach. Electrical systems must evolve
towards “Electrical Smart Grids”.
The electrical smart grids are the evolution of the current electrical systems, the
implementation process of the Distributed Energetic Resources (DER) at the same time
that improving the quality, security and efficiency of the system. The DER are:
Distributed Generation (D.G.), Demand-side Participation (DSP), Electric vehicle and
Decentralized Storage. However, the development of the technology and proper
regulatory frameworks are remarkably important for the proper implementation of the
DER.
It is important to highlight two aspects:
 The Smart Grids are an integration process of the DER; therefore, they are not a
totally new type of networks with new lines and equipment that substitutes the
current one. As any evolution process there is a path that must be followed and
some DER must be integrated before some others (DG and DSP must be
integrated before decentralized storage and the electric vehicle).
 The DER due to their characteristics will be connected to the distribution
networks; thereby, the integration of the DER requires the proper evolution of
the current distribution networks to accommodate these DERs.
The integration of the DER in the current distribution networks are facing several
problems that are preventing their proper integration in such networks.

VIII
Distributed Generation
Distributed generation (DG) refers to electric generation systems connected to the
distribution network, which are characterized by their low power and their near
location to the load or consumption.
Only under certain boundary conditions the DG can bring to the distribution networks
the following benefits:
 Lower electrical losses.
 Deferral of the investments required to reinforce the network.
 Better security of supply service.
Nonetheless, the way in which DG is being connected to the network is bringing the
opposite effects.
Recently, the European National Regulatory Authorities (NRA) have incentivize the
deployment of Renewable Energy Sources (RES) in DG. These incentives were mainly
due to:
 High levelized costs of energy: at the beginning the RES were immature
technologies and they were not able to compete in the electrical markets. Presently,
some of these technologies such as geothermal and on-shore wind power have
levelized costs comparable to those of conventional technologies.
 Their intermittent and unpredictable nature makes very difficult for these
technologies to participate in the energy markets.
These two factors combined motivated that DG RES (which account for an important
share of DG) obtain some benefits such as: priority access and economic support
mechanisms (feed-in tariffs, fees and green certificates, etc.). These benefits have
resulted in:
 DG RES do not participate in the energy markets and DSOs do not receive any
information about their schedule and dispatching.
 DG RES can inject power in the distribution networks at any time without
considering the actual state of the local distribution network where it is connected..
In the planning step, the main problem that DSOs have to face is the lack of firmness
(capacity of a generator to produce/ absorb power when it is required by the system) of
DG. Because of this, DSOs cannot rely on the capacity provided by DG and they have
to reinforce the network to endure the negative effects of the DG.
In the operation step, the integration in the networks of DG (non-predictable load and
bidirectional power flows) requires DSOs to shift from the traditional passive approach
of operation to a more active operation. The DG has 2 negative effects which lead the
local distribution network to alert state.
Firstly, in the medium and low voltage distribution networks (MV and LV networks),
the active power injected by DG produce voltage variations, affecting the quality of the
electricity. To compensate this effect, it is necessary to control the flow of reactive
power. However, reactive power in the MV and LV networks has little effect on
voltage control. This situation results in problem for DSOs to accomplish their tasks.

IX
Secondly, there can be congestions in local area of the distribution network (PG-
PL>Pmax or PL-PG>Pmax) leading the system beyond the security limits. This is mainly
due to the lack of incentives for DG to consider the state of the distribution network in
the area where it is connected.
Regarding the connection and access of the DG, it is necessary to move from the
traditional “Fit and forget approach” to a more “Active management approach”, being
the more cost effective solution.
Within the connection of DG there are the following problems:
 Technical connection criteria: bad criteria for electrical protections, no possibility
to use shallower connection charges instead of deep connection charges.
 Lack of homogeneous national criteria, standardization, transparency and non-
discrimination.
Regarding the access of DG, as mentioned before, the DG has priority access and
support mechanisms that allow DG RES feed-in at any time. This can lead the
distribution networks to blackouts and curtailments when the security limits are
surpassed (decreasing reliability).
On top of that, DSOs need to invest in the integration of ITCs to improve their
monitoring of the network and establish bidirectional communication with DG.
Demand-side Participation
Demand-side participation is a concept that embodies two other concepts:
 Demand-side Management (DSM): implementation of those actions aiming to
influence on the way that energy is consumed, obtaining the desired changes in the
demand curve. These actions oriented to influence the demand are introduced by
DSOs and they can be classified in 4 categories: improve overall efficiency of the
system, shift demand from peak to valleys, fill valleys and reduce demand in critical
moments for the system.
 Demand Response (DR): involves all the changes in end-users’ normal consumption
patterns due to variations on price signals over the time.
The demand of any electrical system is characterized by: seasonal behaviour, peak-
valley ratios, especial events, geographic dispersion, type of demand (industrial, service
and household) and price inelasticity.
From the demand response point of view, the most important of these characteristics is
the inelasticity of the demand. This is mainly due to two factors:
 Final customer’s lack of information about the actual price of the electricity. For this
aspect, the integration of the smart meters will be crucial for final customers to
receive price signals from the energy markets or their energy suppliers.
 A significant part of the demand (small industrial, services and household
consumption) has regulated contracts with static prices.

X
These two factors combined make that final customers cannot be aware of prices and
lack of incentives to modify their consumption habits when the system requires it or
when the prices of the electrical markets are high.
From a planning point of view, ensuring the firmness of demand (reduce/stop
consuming when the system requires it) can be an important tool for DSOs (DSM) to
plan their networks in a more efficient way, postponing reinforcements of the networks.
Furthermore, in the operation step demand response can be used by DSOs to manage
congestions in the system.
For the proper integration of DG and DSP, DSOs need to develop new tools that will
improve their visibility of the system and also will improve the planning and the
operation of their networks. Therefore, DSOs should invest in monitoring, simulation,
control and forecasting tools.
Regulatory framework model: Solutions for the integration of DG and DSP
In the planning step, DSOs need to increase the firmness of the demand and the DG. For
this purpose, NRA should allow DSOs to integrate firm DG/ Demand and create the so
called “firm capacity management markets”.
Within the firm capacity management markets there are two types: the firm DG and
firm demand capacity markets. Because of firm DG capacity markets, DSOs can obtain
extra capacity from DG to postpone investments in reinforcements. At the same time,
the firm demand capacity markets will enable DSOs to incentivize energy suppliers/
large customers to reduce their demanded capacity in some moments when the local
area would be overloaded. Both of these markets try to use demand or DG to provide
the necessary capacity without reinforcing the network.
These markets should be co-ordinated by DSOs, since they are the ones who better
know the functioning of their networks. There are as many markets as areas defined by
the DSOs because they consider the local generation and demand.
The DSOs based on the expected future demand, must foresee the areas and the number
of hours in the year when the network might be overloaded. These services would be
paid by DSOs ex-post. This means that in these markets, the price of the service is
established and only when the DSOs make use of it, the DSOs will pay to the DG/
energy suppliers/ large customers.
The DSOs will procure this services (OPEX) until the moment on which investing in
reinforcements of the network (CAPEX) in the long-term time scale breaks even.
Regarding the connection and access of DG, DSOs have to evolve towards an “Active
management approach” (non-firm connection, non-firm access) since it chases the most
cost-effective solution between OPEX and CAPEX. DSOs should incentivize DG
developer to accept non-firm access contracts in reward of benefits in the connection
charges (use shallower instead of deep connection charges). Non-firm access contracts
will allow DSOs to curtail DG feed-in when congestions occur during the operation.
For the connection of DG, NRA should define proper protection criteria (strongly
recommend UNE or IEC) for each type of technology ensuring the security of the
system. NRA should allow DSOs to offer DG shallower connection charges for those
DG who offer system services (firmness, DSO voltage control, losses compensation,

XI
etc.). Additionally, NRA should define as obligatory the integration of ITCs for the
communication between the DSOs and the DG. For the connection of the demand, the
most important component is the smart meter.
In the operation step, a model based on system’s states is recommended. The
distribution system has three different states:
 Normal state: the system runs smoothly and no constraints are being violated.
 Alert state: the distribution system (locally or the whole) goes beyond the security
limits due to voltage variations, congestions, etc. To solve these problems, the DSO
will purchase system services (services offered by the DER to the DSOs), which are
based on commercial agreements, to come back to the normal state.
 Emergency state: the system (locally or the whole) goes beyond the safe operation
boundaries. For this case, the DSOs will actively influence on the generation/
demand to solve the problems, without considering the commercial agreements, as
soon as possible. Compensation criteria should be defined for this case.
NRAs need to incentivize DSOs to invest in those technologies required in order to
integrate the DERs and their system services to support DSOs in their tasks. DSOs
should invest in: implementation of ITCs, creation of system services markets and tools
(monitoring, simulation, control and forecasting) for co-ordination.
NRA should consider the OPEX and CAPEX derived from these solutions, to
incentivize its gradual integration. For this purpose, NRAs should follow an incentive
based regulation of CAPEX and OPEX at the same time that creating KPIs that
measure the integration level of the new technologies, the quality, the efficiency, the
security and economic variables considering the most cost effective solution.
The subsidies for the integration of new technology in DG should be done in a way that
incentivizes the technological development, becoming more competitive at the same
time that limiting the integration of high shares of immature DG in the system. For this
purpose, NRAs should establish a fix amount of total subsidies. Then, they should
provide with higher proportion of the total to more mature technologies, but providing
less money by project. Conversely, for less mature technologies, a smaller proportion
of the total budget should be devoted, but more money per project. NRAs have to
decide according to their energy policy whether the subsidies are withdrawn from the
access tariff or the National State budget. Both options have negative effects in the
short-term time scale, although the technological development is essential for
improving the competence of the country in the long-term time scale.
For the integration of the DR, there are two basic components: market-reflective
contracts and price signals through smart meters. Energy suppliers must define
attractive products that adjust to their target customer consumption habits, motivating
their voluntary shift from regulated contracts to de-regulated contracts. Additionally,
final customers can obtain potential benefits if they decide to shift their consumption to
those hours with lower energy market prices or when the system requires it (incentives
from firm demand capacity markets).

XIII
Index
1. Introduction, motivation and objectives. .............................1
1.1 Introduction and motivation..................................................................................1
1.2 Objectives..............................................................................................................2
2. The current electrical system in Spain. ................................5
2.1 Physical layer .........................................................................................................5
2.2 Technical management..........................................................................................7
2.3 Economic management level.................................................................................8
2.3.1 Electricity markets........................................................................................10
2.3.1.1 Wholesale market.................................................................................10
2.3.1.2 Retail market.........................................................................................18
2.4 Regulatory framework.........................................................................................19
2.4.1 Structure of the electrical sector..................................................................19
2.4.2 Regulation of the distribution activity..........................................................19
2.4.3 Quality of service, Security and Efficiency....................................................20
3. The evolution of the current electrical system: Smart .........
Grids. .....................................................................................21
3.1 Reasons for the change of the current electrical system.....................................21
3.2 Concept of Smart Grids........................................................................................24
4. Distributed Energetic Resources (DER).............................29
4.1 Distributed Generation (DG)................................................................................29
4.1.1 Definitions....................................................................................................29
4.1.2 Market accessibility......................................................................................30
4.1.2.1 Costs of technologies deployed in DG...................................................30
4.1.2.2 Priority access and support mechanisms for the integration of
renewable energy technologies..........................................................................31
4.1.2.3 Objective of subsidies for new technologies.........................................33

XIV
4.1.3 Planning .......................................................................................................34
4.1.4 Operation.....................................................................................................37
4.1.5 Connection and Access.................................................................................45
4.1.6 Information exchange ..................................................................................52
4.2 Demand-side Participation (DSP).........................................................................54
4.2.1 Definitions....................................................................................................54
4.2.2 Demand characteristics................................................................................56
4.2.3 Lack of demand participation in energy markets: Inelastic demand............58
4.2.4 Planning. ......................................................................................................61
4.2.5 Operation.....................................................................................................62
4.2.6 Technology and information exchange ........................................................64
5. The new role of the DSO and regulatory framework ..........
recommendations..................................................................69
5.1 Planning...............................................................................................................69
5.1.1 Firmness of DG.............................................................................................69
5.1.2 Firmness of Demand ....................................................................................70
5.1.3 Firm capacity management: Firmness markets for DG and Demand. ..........71
5.1.3.1 Functioning of firm DG capacity markets..............................................71
5.1.3.2 Firm Demand capacity markets. ...........................................................73
5.2 Connection and Access........................................................................................75
5.2.1 Connection and access requirement for DSO...............................................75
5.2.1.1 Connection based on Active management approach. ..........................76
5.2.1.2 Network access based on Active Management Approach. ...................76
5.2.2 Connection and access requirements for DG and Demand..........................78
5.2.2.1 Connection requirements from DG’s point of view. .............................78
5.2.2.2 Connection requirements from demand response’s point of view.......80
5.2.2.3 Access requirements from DG’s point of view. .....................................81
5.3 Operation ............................................................................................................81

XV
5.3.1 System state model and system services as tools for the DSO.....................81
5.3.2 Concept of system services and system services required for each state of
the system..................................................................................................................82
5.3.2.1 System services definition.....................................................................82
5.3.2.2 System services required for each state. ..............................................83
5.4 Regulation of OPEX and CAPEX for DSOs .............................................................89
5.4.1 CAPEX regulation..........................................................................................89
5.4.2 OPEX regulation. ..........................................................................................90
5.5 Integration of DER into the market......................................................................90
5.5.1 DG ................................................................................................................90
5.5.2 Demand Response .......................................................................................92
6. Conclusions ...........................................................................94
References ...................................................................................98

XVI
Index of Figures
Figure 1: Simplified single line scheme of the electrical system...........................................5
Figure 2: The product and service electricity model.............................................................9
Figure 3: Concepts included in Costumers' bill. Source: Own..............................................9
Figure 4: Structure of the electrical market. Source: Own .................................................10
Figure 5: Offer and demand curve construction ................................................................12
Figure 6: Supply curve [2]...................................................................................................12
Figure 7: Demand curve [2]. ...............................................................................................13
Figure 8: Marginal Price [2]. ...............................................................................................13
Figure 9: Marginal prices of the energy for each hour of a certain day [3]. .......................14
Figure 10: Daily and intra-day market sessions [1].............................................................15
Figure 11: Adjustment services markets. ...........................................................................16
Figure 12: Volatility of prices in the wholesale market. .....................................................18
Figure 13: Capacity's evolution of the electrical system depending on the criterion .........23
Figure 14: Necessary components of Smart Grids and objectives. Source: Own...............25
Figure 15: Possible smart grids’ route integration. Source: Own. ......................................26
Figure 16: Levelized Energy Cost for different technologies [4] .........................................31
Figure 17: left net capacity curve / right monotonous capacity curve of transformer .......35
Figure 18: curves of the cogenerator .................................................................................36
Figure 19: curves of the transformer..................................................................................36
Figure 20: Thevenin equivalent at the connection point of DG..........................................39
Figure 21: voltage profile depending on the length and network conditions. ...................41
Figure 22: representation of the extra-cost in the access tariff due to system services co-
ordination...................................................................................................................43
Figure 23: DER access and connection approaches. Source: [7].........................................47
Figure 24: Mechanisms of Demand-side Participation ......................................................55
Figure 25: Demand profile of the different groups. [8] ......................................................56
Figure 26: seasonal behavior of demand. Own based on data from .................................57

XVII
Figure 27: Dispersion of the generation and the demand [8].............................................58
Figure 28: Inelastic and elastic behavior of demand. .........................................................59
Figure 29: End-users' electricity bill....................................................................................60
Figure 30: Possible distribution network topology and the monotonous demand curve for
the transformer during a year. ...................................................................................71
Figure 31: Bids of firm capacity of DG producers connected to a certain area. .................72
Figure 32: Possible network topology of a certain area with few DG and its monotonous
demand curve................................................................ ¡Error! Marcador no definido.
Figure 33: Functioning of the firm capacity of demand market. ........................................74
Figure 34: Concept of System Service. ...............................................................................83
Figure 35: Difference between the cost of producing energy with a certain technology and
the marginal price of the whosale market according to its experience curve. ...........91

XVIII
Index of Tables
Table 1: Characteristics of the different distribution networks [1] ......................................6
Table 2: Electrical activities involved in the electrical sector..............................................20
Table 3: Support mechanisms according to different criteria [5] .......................................32
Table 4: Typical values for R/X relation for different voltage levels ..................................39
Table 5: connection and access approaches. Source: Own ................................................45
Table 6: voltage levels and its typical generation technologies..........................................49
Table 7: Connection and access approaches. .....................................................................75
Table 8: System Services. Source: own and [7]...................................................................88

1
1. Introduction, motivation and objectives.
1.1 Introduction and motivation
In Europe recently, the population awareness about the environmental impact together
with the high dependence of natural resources from geopolitical unstable countries, has
motivated changes in the European energy policy. For this reason, future intentions such
as the objectives 20/20/20 are motivating new tendencies in the energy systems of the
different European countries.
The effect of this policy on the electrical system, especially in Distribution networks, is
that EU countries have incentivized the connection to the network of small generation
groups close to the load (Distributed Generation). The consequences of DG can be
extremely positive for the efficiency of the electrical system. Additionally, if an
important share of the DG is renewable technologies, the environmental impact can be
dramatically diminished compare to systems entirely based in fossil fuel technologies.
Nevertheless, the effect of DG in those networks with high share of DG is becoming the
opposite of the desired. Due to the EU regulatory framework, DG:
 Has priority access to the network, being able to inject power to the network
whenever they produce it without participating in the electrical markets. Therefore,
distribution network operators miss much information from the DG connected to
their network.
 DG has no obligation to produce when the load peaks or when the system requires a
back-up (no firmness of DG). Therefore, distribution network operators cannot
consider DG when designing their networks in the long-term (planning).
 The monitoring level of Medium and Low voltage distribution networks is deficient.
Moreover, DG has priority access and does not participate in the electrical markets.
All these factors make that DNOs have no information during the operation about
the actual state of the system.
 The connection of DG produce changes in the operation conditions of the system
(Voltage variation, reverse power flows, etc.). Nonetheless, DG has no obligation to
support DNOs in the operation of the areas where DG is connected.
 All these counterproductive factors make necessary changes in the current
regulatory framework, in order to about these problems and properly integrate DG
in the distribution system.
The traditional approach when expanding the distribution networks together with the
consumption habits of final customers, result in over-sized systems. The demand of
electricity is not constant along the time. It has peaks and valleys but the electrical
networks are designed to provide the required capacity when the load peaks. However,
these peaks represent a small proportion of hours over the total amount of hours in a
year. Consequently, the system is inefficient.

2
In order to avoid over-sized and inefficient distribution networks with high investments
in capacity, there is the need to change to a new paradigm. The new paradigm “demand
follows supply” in contracts with the traditional one “Supply follows demand” require
the implementation of the Demand-side participation.
The aim of the demand-side participation is to motivate the necessary changes in the
demand curve so that the capacity of the electrical system can be used more efficiently.
However, the current regulatory framework does not allow the actual participation of
the demand in the electrical market. It can be said that the demand is inelastic to
variations of the price. This is mainly due to the lack of information of final customers
about the real price of the electricity.
It is necessary changes in the regulatory framework to provide final customers with the
necessary information so that they can participate more actively in the electrical market.
Derived from this, the demand will manage more actively their consumption. This
active management will allow DNOs to use more efficient the already installed capacity
and assets.
Both, Distributed generation and Demand-side participation are two of the four
Distributed Energetic Resources (Distributed Generation, Demand-side Participation,
Decentralized Storage and Electric Vehicle) which constitute the Electrical Smart Grids.
The aim of the Smart Grids through the implementation of these four DER is to improve
the efficiency and sustainability of the system while reducing the environmental impact.
All this keeping the quality of the product and security of the service at the minimum
cost.
To conclude, Smart Grids are the evolution of the current electrical system. The success
of this evolution highly depends on the integration process of the Distributed Energetic
Resources. This integration process requires important changes in the present regulatory
framework and this is the motivation of this dissertation. Regulatory recommendations
based in a sustainable model constitute the basis for the already on-going integration of
the Smart Grids.
1.2Objectives
The main objective of this dissertation is to create and define a proper regulatory
framework which integrates the Distributed Generation and Demand-side Participation.
This regulatory framework must protect the economic interests of all the agents involve
in the electrical system at the same time than ensuring the quality of the product and the
security and efficiency of the system.
In order to achieve this aim, it is necessary to accomplish a series of partial objectives
which constitute the basis of this main objective. These partial objectives are:

3
 Define and characterize the Electrical Smart Grids.
 Identify the key elements for the proper integration of the Distributed Generation
and Demand-side Participation.
 Identify the role of the DSOs and barriers they face for the proper integration of
Distributed Generation and Demand-side Participation.
 Analyse the regulatory and economic aspects that need to be modified for the
proper integration of Distributed Generation and Demand-side Participation.
The structure of the dissertation is as follows:
In the chapter 2, the four activities involved in the functioning of any electrical
sector that has suffered a de-regulation and unbundling process are described. These
activities are: the physical layer, technical management layer, economic activities
and regulation framework. In this chapter there is a special emphasis in the electrical
markets and the regulation of DSOs.
In recent years, due to the new tendencies of the energy policies in the EU, changes
in the energy systems are occurring. In the case of electrical system and especially
in distribution networks, the result has been the connection of a high share of RES
DG. However, the connection of the DG is the first step towards the connection of
other distributed energetic resources to the distribution networks. To face these new
challenges, the distribution networks must evolve towards the smart grids.
The development of the smart grids for the future integration of the distributed
energetic resources is crucial. Therefore, in chapter 3 the concept of smart grid and
certain characteristic associated to them are explained
Then, Chapter 4 analyses the current economic and regulatory barriers that
distributed generation and demand-side participation are facing for a proper
integration in the distribution networks. This analysis is divided into different parts
that have to be considered to properly integrate the distributed energetic resources in
the distribution networks: definition, market accessibility, planning, connection and
access, operation, information exchange, etc.
Subsequently, chapter 5 define possible regulatory solutions to the problems of each
DER diagnosed in chapter 4. Therefore, chapter 5 creates and defines a regulatory
framework which integrates the Distributed Generation and Demand-side
Participation. This regulatory framework must protect the economic interests of all
the agents involve in the electrical system at the same time than ensuring the quality
of the product and the security and efficiency of the system.

4
To conclude, in chapter 6 all the regulatory recommendations required to implement
the solutions presented in chapter 5 are summarised.

5
2. The current electrical system in Spain.
The electrical system has a complexity which goes beyond the physical layer, in fact,
the electrical system comprises four different layer: physical layer, technical
management, economic management and regulatory framework. Subsequently, a more
detail analysis about the four different layers that constitute the electrical sector, will set
the basis of how this industry runs.
The most important aspect in the current electrical sector was the liberalization process
that has taken place. In 1982, Chile was the first country which separated the different
activities of the electrical system into regulated and de-regulated activities. In the
following years, this trend extended to many other countries.
The liberalization process has different characteristics depending on the country.
However, all of these processes have in common:
 Separation of regulated and de-regulated activities.
 Creation of a wholesale market in which generators compete.
 Access to third parties to the transmission networks through toll payments.
 Freedom of clients to choose their energy suppliers.
2.1Physical layer
The physical layer refers to the transformation of a primary energy into electricity and
the transmission of it to the final consumers through the electrical network. This layer
can be seen as the hardware of the electrical system.
A simplified single line scheme of the electrical system is depicted in Figure 1:
Figure 1: Simplified single line scheme of the electrical system.

6
The distribution network connects the transmission network with the final costumers.
The distribution networks can be divided into three different categories depending on
their voltage level:
 High voltage networks (HV).
 Medium voltage networks (MV).
 Low voltage networks (LV).
The features of each category can differ from one country to another. However, the
general characteristics are presented in Table 1.
Type of
distribution
network
Topology Operation
Number
clients
Amount of
equipment
Operation
flexibility
Monitoring
level
HV Meshed
Meshed/
ring
Few Several Medium High
MV
Meshed/
ring
Ring Several Many Few Medium
LV
Meshed/
ring
ring Many Many A few Low
Table 1: Characteristics of the different distribution networks [1]
High Voltage Distribution Networks
High voltage distribution networks present a meshed layout, which improves the
reliability of this level. Only few clients which demand high power requirements
connect to this network (for instance: industries, long distance trains and trains and
special regime).
The number of clients connected a type of network is a very important factor. The
higher number of clients the more difficult to monitor and operate the network.
Moreover, many clients connected demands high investments in facilities and
equipment.
Medium Voltage Distribution Networks
The typical topologies of medium voltage network are ring or meshed.The topology of
the medium voltage network depends on the geographical location of customers. The
meshed level is direct related to the level of service continuity that wants to be offered
to the costumers.

7
In the medium voltage networks DNOs have a medium monitoring level but not real
time operability. Typically, the SCADA systems responsible for the medium voltage
networks control only the substations which are located on the border (either with other
distributors or with high and low voltage distribution networks).
Typically, the SCADA systems can:
 Monitor the measurements.
 Maneuver.
 Protection.
 Visualization of equipment’ state.
However, at the moment DNOs only monitor the limits of the medium voltage networks.
Therefore, they cannot visualize the real-time conditions of this networks.
Low Voltage Distribution Networks
The low voltage network starts at the medium voltage substations and finishes at the
General Protection Box (GPB). Beyond this point, the network belongs to the clients.
The large amount of costumers and equipment connected to this network makes
unfeasible to set real-time measurements. The enormous amount of clients makes
necessary high installation and maintenance investments.
The monitoring level is deficient and this is why in most of the cases, when costumers
suffer blackouts, distributor are not aware of it. It is only through telephone calls from
the final clients that they realize there is a fault.
2.2Technical management.
Technical management is the responsible for the proper functioning of the physical
layer. The technical management activity is carried out by the operators of the electrical
networks.
In distribution networks, the main responsibilities of distribution network operators are:
 To keep electrical parameters of the system within the security limits (For instance:
voltage variation, temperature of active components, maximum current, etc.)
 Maximize service continuity.
 Maximize quality of the product for final customers.
 Minimize system losses.
These responsibilities must be achieved by DNOs under any circumstances. These tasks,
as any other activity involving the DNOs, are defined and established by National
Regulatory Authorities.

8
Depending on the country, the operation of distribution networks can be performed by
different agents. In the concrete case of Spain, the distribution network is managed by
many distribution network operators such as (Endesa, Iberdrola, E.ÓN, Gas Natural
Fenosa, etc.) which are responsible for different parts of the system.
2.3 Economic management level.
The economic management refers to all the activities related to the purchasing and
selling of electricity. At this point it is very important to distinguish the electricity as a
product [MWh] and the electricity as a service [MW or MWh].
Electricity as Product (Energy)
Electricity as product (energy). The product electricity is manipulated by de-regulated
activities whose aim is to satisfy the energy needs of costumers.
The price of the electricity as a product can be fixed by different mechanisms. The best
of these mechanisms are the markets ruled by the offer and demand law. These markets
are the best mechanism because they ensure the balance between the interests of the
offer and the demand.
Electricity as a Service (Energy)
The electricity as a service (power or energy). The service of transmission, distribution
and delivering of the product is performed by the regulated activities. Their aim is to
guarantee the security and quality of the supply service.
Final customers pay for this service through the access tariff, which is the regulated part
of their bills. However, part of these services is ruled by the offer and demand markets.
This is the case of the adjustment services (technical constraints markets, ancillary
services, deviation generation-consumption) which are markets ruled by the offer and
demand law but used to ensure the security of supply when there are constraints in the
system.
The concepts of electricity as a product and electricity as a product are depicted in
Figure 2.

9
Figure 2: The product and service electricity model.
Due to the concept of electricity as a service and as a product, final costumers’ bill is
made up of two different parts: the energy consumption (electricity as a product) and the
electricity service. The price of the energy depends on the contracts between final
clients- energy suppliers or directly the price of the wholesale market.
In Figure 3, the breakdown of final customer’s electricity bill is presented:
Figure 3: Concepts included in Costumers' bill. Source: Own
Due to the unbundling process the regulated activities are not the same in all the country.
In all the cases, the regulated activities include investment and maintenance of the
Electricity bill
Network
(service)
Regulated: access tariff
Energy
(product)
De-regulated
( Energy market
price signals)
Price signals
Market-reflective
contracts
(ToU, CCP, Real-time
pricing)
Regulated Static prices

10
transmission and distribution network, but other concepts depend on the country. In the
specific case of Spain, the access tariff covers the cost shown in figure 2
2.3.1 Electricity markets
When describing the electricity as a product, it was claimed that the best mechanism to
fix the price for the electricity was the markets ruled by the offer and demand law. In
this section, the markets of the electrical system will be presented.
In all countries on which a process of liberalization took place, the structure of the
electrical market is structured as illustrated in Figure 4: Structure of the electrical
market.
Figure 4: Structure of the electrical market. Source: Own
2.3.1.1 Wholesale market
The wholesale market is where large amounts of energy are sold and purchased.
Through a series of market sessions, the generators and demand come to an agreement
about the amount and the prices of the energy that is going to be consumed each hour of
a certain day “D”. It is not until that day D that the electricity is actually delivered to
final customers.
The agents involved in the wholesale market are:
Electrical market
Wholesale market
(Generators↔Energy suppliers/Large
customers)
Long-term
market
Financial tools
(no physical
delivery)
Short-term
market
Intra-day market
Adjusment Services
Markets
Daily market
(physical delivery)
Retail market
(Energy suppliers↔Final
customers)

11
 Producers: they are the ones who generate the electricity (Nuclear power plants,
hydro power plants, etc.) and offer it in wholesale markets. They are the offer.
 Large customers/ energy suppliers: they are the ones demanding the electricity in
the wholesale markets. Therefore, they are the demand.
The short-term markets within the wholesale market are sometimes characterized by the
volatility of its prices (spot market). This means that the prices of the energy are very
changeable along the time. This volatility involves economic risks, in terms of incomes,
for generators and large customers/ energy suppliers. Thus, both parts try to avoid this
risk using different economic tools. These economic tools can be established days,
months and even years in advance to the actual delivery of the electricity in day D
(long-term markets).
Therefore, the wholesale market is made up of: short-term and long-term markets.
A. Short-term markets
The short-term market comprises:
 Daily market: economic activities that take place the day before the physical
delivery (D-1). In this market is where offer and demand purchase and sale the
energy for each hour of the day D.
In any market structure, the daily markets are there reference to establish the price
of the electricity. In all those countries where a liberalization of product related
activities, in order to operate and manage the daily market, there is a market
operator. However, there can be immature markets where there is no such market
operator.
The daily market works as follows:
In the daily market, generators and consumers send their offers and bids (energy
[MWh] and price [€/MWh]) to the market operator for each hour of the following
day (see left side of Figure 5). Besides the offer and demand bids, the operator
receives the international exchanges and in the case of structured and mature
electrical market, the market operator also receives bilateral agreements (explained
in long-term markets section).
As mention above, the supply and demand bids are for each single hour of the
following day; this means that there are 24 different products for each day.
After the market operator gathers the bids, the market operator places in ascending
price order the supply offers and in descending price order the bids offered by the
demand for each hour (see right side of Figure 5).

12
Figure 5: Offer and demand curve construction [2].
Controllable power controllable
Subsequently, the market operator creates the supply and demand curves as
represented in Figure 6 and Figure 7 respectively.
Figure 6: Supply curve [2].

13
Figure 7: Demand curve [2].
Finally, these two curves are overlapped and the point where the supply and
demand curve match, establishes the amount of energy [MWh] and the price
[€/MWh] for that energy that is going to be consumed for that hour (see Figure 8).
Figure 8: Marginal Price [2].
As mentioned above, this curve is done for each hour of the day so for the whole
day there are 24 different prices, as represented in Figure 9.

14
Figure 9: Marginal prices of the energy for each hour of a certain day [3].
Inspecting the supply curve it can be noticed that the curve starts at 0 €/MWh. This
is the energy that the nuclear power plants generate. The reason for this is that the
nuclear power plants are very stable and changing the working conditions is
difficult. In this way, they make sure that the energy produce by means of nuclear
power plants will be always in the pool. In contrast, some other technologies which
are more flexible on their operational status (cogeneration, renewable energies, etc.)
offer higher bids than nuclear power plants and other conventional technologies.
Furthermore, it is necessary to underline that all generators which are beyond the
matching, will not supply energy to the network. The offers are higher because their
operational costs are higher than the fixed price established in the wholesale market.
At this point is where the competence between generators plays and essential role.
In other words, those generators who offer the lowest prices are the ones that
provide the energy and receive the money. Conversely, if the cost of generating
electricity is higher than the pool price, it is not profitable to provide the energy and
those generators will not participate in the pool.
Changing the perspective to the demand side, the demand curve starts at 183
€/MWh. By law, this is the highest price that can be offered in the pool. This is
done because in this way, demand make sure that the vast majority of the energy
(around an 80%) they have to supply to the final clients will be provided.
In the specific case of Spain, the market operator is OMIE (responsible of the daily
market not only in Spain but also in Portugal). It guarantees a legal and transparent
administration of the daily market.
 Intra-day market: those activities during the day of the physical delivery (D).
Once the daily market is closed, during day D offer and demand can change the
electricity they purchased/ sold in the daily market.

15
Once the daily market is closed and in the following 24 hours there are 6 intra-day
market sessions on which the generators and demand can change their deals about
purchase-sale (see Figure 10). The agents and market operator involve in this
market are the same as in the daily market and it works in a very similar way.
Due to its proximity in time to the actual delivery of the electricity, the volatility of
these markets is higher than the daily markets and that is why any agent tries to
avoid participating in these markets as much as possible.
Figure 10: Daily and intra-day market sessions [1].
This market is a consequence of the necessity to keep continuously the equilibrium
between generation and consumption. The consumption is foreseen by energy
suppliers, but this forecast may differ from the actual consumption. Therefore,
energy suppliers may need different energy requirement. These sessions help
generators and demand to manage the deviation from the actual consumption.
Sometimes it may occurs, as it happens in the daily markets, that the agreements of
the daily market are in conflict with the technical constrains of the system. These
conflicts are solved by the System Operator through adjustment services markets.
 Adjustment services markets: additionally, during the day D there are other
markets which are used to ensure the security of the system and the equilibrium
between generation-demand. These markets are the adjustment services markets. These
markets include: technical constraints markets, ancillary services and deviation
generation-demand management.

16
Figure 11: Adjustment services markets.
Source: Own
Technical Constraints Management
The daily market is just based on offer and demand laws, economic laws. Nonetheless,
the electrical system has technical constrains and the most important, the electricity
does not follow economical laws but physical laws (Ohm and Kirchhoff).
The generation and the demand are scattered all around the national geography and they
are connected through the transmission and distribution networks. Therefore, there can
be technical constrains, for instance overload of lines and substations. Thus, some areas
of the electrical system might be congested affecting some of the generation plants that
were supposed to inject power.
To solve this problems, after each session of the daily and intra-day market and taking
into account bilateral agreements, the System Operator execute a process to manage the
technical constraints. For this purpose, the system operator analyses the scheduled
production of generation plants and expected international exchanges. With this
information the SO can operate the system to solve the constraints and guarantee the
supply of electricity.
Ancillary Services
As in the technical constrains study performed after the daily market, there is real-time
monitoring of the system. The Ancillary services are those tools necessary to ensure the
security, quality and reliability of the electricity supply service. Some of the ancillary
services are frequency-active power (primary, secondary and tertiary) regulation,
voltage variation-reactive power generation and others.
Deviation Generation-Demand management
Adjustment
services
Technical
constraints
management
Ancillary Services
Frequency- Active
Power regulation.
Voltage- Reactive
Power regulation
Others.
Deviation generaton-
deman management

17
Additionally to all the mechanisms mentioned above, in order to solve the differences
that may appear minute to minute between supply and demand, the System Operator has
mechanisms to solve the deviations. Only in the exceptional case that the difference
between supply and demand is higher than a defined threshold, the System Operator can
convene a “deviation management market”. In this market, the SO can increase or
reduce the energy agreed in the daily and intra-day market.
These three services are normally controlled and operated by the System Operator. The
way to make the modifications is through markets on which these services are provided
to the SO by the generation groups.
A. Long-term markets and risk aversion
The long-term market (before D-1) includes all the economic activities which are
performed before the day of the physical delivery (before D-1).
When describing the short-term markets, it was mentioned that they are sometimes
characterized by the volatility of the prices. This volatility represents a risk in terms of
incomes for demand and generation. Therefore, in organised and mature markets it is
very common that the different agents establish bilateral agreements days, months and
even years in advance to the actual delivery of the electricity in the daily markets.
Therefore, when the agreements are created, there is not physical delivery of the
electricity (financial products related to the electricity).
The objectives of the long-term markets are:
1. Allow generation and demand to manage their economic risk.
2. Facilitate the development of retail market, increasing the competence on it.
These bilateral agreements are established directly between generators and large
customers/ energy suppliers. Thus, these contracts are not organised by any regulated
and centralised institution.
Some of the financial tools used to prevent the economic risk are:
 SWAP: financial contract established a certain time “t” before day “T” where there
is the actual delivery and cash-flow. This contract determines the energy and the
price of this energy day T.
When day T comes, the energy is provided by the generator. The fixed priced of the
contract is compared with the price of the daily market. If the fixed price of the
contract is below the spot market price, demand pays the spot price market and
additionally gives the difference to the generator. Conversely, if the fixed price of
the contract is above the spot market price, the demand will pay the spot market

18
price but the generator will provide the difference. This cash-flow is depicted in
Figure 12.
Figure 12: Volatility of prices in the wholesale market.
Source: Own
 Options: provide the owner the right, but not the obligation, to purchase or sell a
certain amount of asset (energy) at a specified strike price on or before a specified
date. The seller receives then a premium from the buyer [6].
There are two types of options: CALL and PUT. A CALL option is an option of
purchasing and a PUT option is an option of selling. In the moment the option is
established, the one acquiring the option pays a premium. The option can be
“exercise” (buy or sell the asset) by its owner at any time before the end of the
specified date. The cash-flow is equal to the difference of the strike price of the
asset and the premium already paid.
2.3.1.2 Retail market
The retail market is that one on which the energy suppliers sell the energy they bought
in the wholesale markets to final customers who do not participate in the wholesale
market.
Before the liberalization of the electrical sector, final customers could not choose their
energy supplier. The energy supplier was the same as the DNO controlling that area.
After the liberalization, final customers can choose the energy supplier which best suits
their needs.
The possibility of the final customers to choose their energy supplier motivates a fierce
competence between energy suppliers trying to attract new customers.

19
2.4 Regulatory framework
According to Tenenbaum, 1995, regulation is a “system (of laws and institution) that
enables a Government to formalize and institutionalize it compromises of protecting
consumers and investors in a certain industrial sector”
2.4.1 Structure of the electrical sector.
Due to the liberalization process, there are activities on the structure of the electrical
sector which are regulated while some other activities are de-regulated. The regulated
activities are network activities (transmission, distribution), technical operation and
organized market operation. The de-regulated activities are generation, wholesale
markets and retail markets and they are ruled by the offer and demand law.
A perfect comprehension of the structure of the electrical sector is critical to fully
understand the regulatory framework. In Table 2, there is a schema comprising all the
activities involved in the electrical sector. In yellow the regulated activities and in green
de-regulated activities.
The network activities (distribution and transmission) are considered as natural
monopolies. This is because there is no sense in constructing new lines in parallel to
allow the competence between different companies. Therefore, distribution is a
regulated activity. There are two main aspects within the regulation of the distribution
activity: Cost based or incentives based regulation and the control of the quality of the
service.
2.4.2 Regulation of the distribution activity
There are two ways to regulate the distribution activity: Cost of service and regulation
through incentives.
Cost of Service has been the traditional regulation method for natural monopolies in the
electrical sector. According to this method, the National Regulatory Authorities (NRA)
establishes the remuneration for the company according to justified costs plus the return
on the invested capital (ROI).
The main problem with this regulation is that the companies do not have any motivation
to reduce costs and make more efficient their networks. To solve this problem, there is
another type of regulation, incentives based regulation.
Incentives based regulation. The NRA fixes a defined amount of money for a certain
period of time (4 or 5 year). With this method, DNOs try to minimize their costs in
order to obtain higher revenues.
When the period of time finishes the NRA supervise the cots and investments. The
result of this supervision is a new formula that limits the prices or the incomes of the
company.

20
The main problem with this method is that together with the reduction of costs, DNOs
may incur into less quality service. For this reason, NRA must control and define a
minimum quality for supply service.
Activities within the electrical sector
Generation Network Transactions
 Ordinary regime: all the
classical generation
technologies.
 Special regime:
All the technologies
which have less
environmental impact or
better energetic
efficiency.
 Adjusment services.
 Transmission
 Expansion planning
 Construction
 Maintenance
planning
 Maintenance
 Transmission
operation
 Distribution
 Expansion planning
 Construction
 Maintenance
planning
 Maintenance
 Distribution
operation
 Wholesale market
 Retail market
 Energy suppliers
 Complementary
activities
 Settlement.
 Billing.
 Metering.
Coordination
 Technical operation of the electrical system
 Organized market operation ( if it exists)
Table 2: Electrical activities involved in the electrical sector.
Source: own
2.4.3 Quality of service, Security and Efficiency.
Another important factor within the regulation of the distribution activity is that NRAs
keep the control of the three main tasks of DNOs:
 Good service quality: maintain voltage and frequency within acceptable values.
 Security: continuity of the service in the short-term scale.
 Efficiency: electricity supply with the minimum cost.
There are different measures to keep control of these factors and although they may
vary from one country to another, in all the country these three aspects are regulated.

21
3. The evolution of the current electrical system: Smart
Grids.
3.1 Reasons for the change of the current electrical system.
In recent years there are three main factors that are determining the energy policy in
Europe. These three factors are:
 Reduction of environmental impact.
 Improve security of raw materials supply.
 Sustainability of the power systems.
This is why in order to lessen the environmental impact and fossil fuel dependence, in
2008 Europe decided to set new milestones in its energy policy for 2020. The attempt
gave as a result the objectives referred to as 20/20/20 for 2020:
 Reduction of greenhouse gases emissions by 20% of those in 1990.
 A 20% of the total energy consumption produced with renewable energies.
 Reduction of 20% of the total energy consumption enhancing the energetic
efficiency.
Environmental Impact
In recent years society has witnessed a consciousness-raising about the environmental
impact and the crucial role that human activities play on it.
The environmental impact is due to the gas emissions originated in factories, vehicles,
fossil fuel power plants, etc.
Some of these gases only affect to the local environments (gases such as NOx and SOx),
however the emissions of CO2 affect to the global greenhouse effect. The CO2 is one of
the gasses that appear in the exhaust of the combustion of fossil fuels.
Fossil fuels are currently indispensable in human activities such as industry and
transportation. The main problem with CO2 is that it is released to the atmosphere in
higher amounts that what can be naturally.
The awareness about this problem resulted in a search of alternative energy sources that
pollute less than fossil fuels. The consequence is the development of renewable energies.
Renewable energies enclose all those technologies which use local resources which are
virtually inexhaustible. Nevertheless, the renewable energies are characterized by their
intermittent and unpredictable nature (the wind blows when it wants and the sun
shines when it wants). These characteristics introduce new and big challenges in the
electric system because unlike conventional generation plants, renewable energies are
non-controllable technologies.

22
Security of Supply
Regarding the security of supply, fossil fuels constitute the basis for European
energetic system. Most of these fossil fuels are imported from countries outside Europe
with unstable political background, decreasing European energetic independence. Thus,
it is a must for Europe to find alternative energy sources to be more independent from
exterior energy supplies and improve its security of supply.
Due to this dependence, Europe has to introduce changes in its energy policy in order to
use more efficiently its own resources while it shifts from fossil fuels to other forms of
energy which reduce its external dependence. With the aim of contributing to the
reduction of fossil fuel dependence, the electrification of the transportation can be the
perfect option.
Nonetheless, the current electrical system is not prepared for the integration of electric
vehicles. Still, there is the need to improve the technology but also to define the proper
regulatory background for their future integration in the electrical system.
Sustainability of the electrical system
Regarding the electrical system, the objective of reducing 20% of the total consumption
improving the efficiency is inherently linked with its sustainability. This reduction of
the energy consumption cannot only be based in a reduction of each final customer of
their consumption. Europe must be able to reduce the energy consumption developing
more efficient electrical system which improves the utilization of the electricity.
For instance, In Figure 13 the evolution of networks’ capacity is depicted. The traditional
method used to supply the growing demand has been increasing the capacity of the
system. The method is based on the idea that the electrical system must be able to
supply energy in the worst case that all consumers, at the same time, require the
maximum power contracted.
The result of this conception is that systems are designed for a capacity which is only
used few hours a year. Therefore, the electrical systems in most of the cases are over-
sized systems. This situation is unsustainable because large investments are required to
provide that capacity which only few hours along the years.
In the past (left part of figure 1), conventional generation released its energy to the
transmission network and all based on a centralized control (System Operator). The
transmission network was connected to the distribution network with a passive control.

23
However, there was a time when distributed generation started to be connected to the
distribution network.
Figure 13: Capacity's evolution of the electrical system depending on the criterion
Proyecto Fenis.
Currently (central part of figure 2), the problem that the electrical system is facing is
that distributed generation has a very strong presence on distribution networks.
However, this distributed generation is connected to the distribution network as an
intermittent generation (lacks of security of supply and firmness). Hence, distributed
generation is substituting to the conventional generation in energy [MWh], but not
capacity [Mw].
Subsequently, the installation of every MW of distributed generation involves another
MW of conventional generation, in order to maintain security of supply. This situation it
is unsustainable and that is the reason why a different perspective needs to be taken to
address this situation more efficiently.
Distributed generation needs to be properly integrated in the network. Furthermore,
demand side participation has a very important role to achieve the active management
of the network (right part of figure 1). On top of that, the efficiency of the overall
system requires bidirectional communication between transmission and distribution

24
network operators. Only changes on this direction can reinforce the efficiency of the
system.
The problems of the electrical system demonstrate that if the electrical system wants to
play an important role in the reach of the three main objectives, new solutions are to be
considered.
The integration of new technologies that help to achieve the 20/20/20 objectives is a
process which in many countries has been called as “Smart grids”. The smart grids will
represent the evolution towards a more efficient, secure and environmental friendly
system. This evolution will improve the quality of the product (electricity) and the
efficiency and sustainability of the service.
3.2 Concept of Smart Grids
Smart grids are those electric networks that enable the integration of the Distributed
Energetic Resources (DER) in an efficient way, maximizing the quality of the service at
the minimum cost.
The DERs are:
1. Distributed Generation (GD).
2. Demand side participation.
3. Electric vehicle.
4. Decentralized storage.
It is crucial to comprehend that smart grids are neither something physical (no smart
meters, no TICs, no new topologies on the networks, etc.) nor a revolution or
completely new system that discards the present one.
The smart grids are a process, an evolution of the current electric system that will
enable the integration of the DER enhancing the quality, efficiency and
sustainability of the electrical service and product.
The success of this process compels the proper technological development and the
convenient regulatory framework. Both of them are fundamental for a convenient
integration of the DER and therefore, the proper implementation of the smart grids
process.
The NRAs through regulation have to ensure:
 Protection of the interest of all the agents involve in the electric system.
 To ensure the security, efficiency and quality of the electricity service and
product.

25
 To set the proper policies to facilitate the development and maturity that new
technologies becoming profitable and therefore competitive enough to be integrated into
the electrical markets.
The different DERs that constitute the smart grids, together with the complementary
elements (new technologies and regulatory framework) and the objectives, are depicted
in Figure 14.
Figure 14: Necessary components of Smart Grids and objectives. Source: Own
Since the smart grids are an evolution, they need to introduce step by step each of DER.
Each DER requires first the integration of other DER, new technologies and adequate
regulatory rules to be successfully integrated into the system.
As a consequence and as any other process, the smart grids require several steps to be
integrated within the system. A possible route could be as represented in Figure 15.

26
Figure 15: Possible smart grids’ route integration. Source: Own.
Presently, distribution networks are functioning in very good conditions but DNOs need
a much higher level of monitoring and operability of their medium and low voltage
networks. DNOs receive scarce real-time data from these networks what means that
they are unable to supervise their actual state. Other requirements such us more remote
management systems, more tools to help the operation of the grids and better regulatory
frameworks are indispensable to achieve the optimum working condition of distribution
networks.
In parallel the evolution towards integration of DG is occurring. The main problems
about the integration of the DG is that there is no the proper background to incentivize
DNOs to integrate DG in their networks.
Subsequently, the expansion of remote management systems (smart meter among others)
with bidirectional communication will be the technological gateway to integrate the
following DERs.
Afterwards and not earlier, the demand-side participation will be possible. The demand-
side participation, involves demand-side management and demand response.
Additionally, the introduction of electric vehicles will require more advanced
technologies and it will play an important role within the demand-side participation. Of
course, all these changes must be accompanied by adequate regulatory rules.
Finally and after all these steps, the optimization and the coordination of all DERs
integrated within the system must be performed. It is only after completing this route,
when the electrical system will be provided with benefits such as:

27
 Self-regenerative: networks will be provided with components able to check,
analyse and diagnose in order that they can identify and fix those devices which are
damaged or in bad operative conditions. As a consequence, the quality of the
supply will increase.
 System focus on consumers: consumer will be well aware of their consumption
and prices and based on this, they can modify their habits. This change will help to
the reduction of electricity utilization in peak hours, when the prices of the
electricity are higher. At the same time, it would be possible to shift part of the
demand of the peak hours to the valley hours, obtaining a more stable demand
curve.
 Quality improvement of the service: consumers will be able to choose the quality
they need attending to different prices. Moreover, the use of signal actuators based
on power electronics will prevent perturbations (harmonics and flickers) from
equipment.
 Facilitate interaction between agents in the electrical markets through a secure
network that allows the aggrupation of many costumers and distributed generation,
facilitating their aggregation and communication. The interaction between offer and
demand side is crucial to achieve resource’s efficiency because there will be a
better agreement in terms of capacity and energy available at any moment.
 Optimized use of facilities and their operation: due to the information that clients
have, the consumption will be more equilibrated along the day and the utilization of
the network will be better. This motivates a flatter demand curve, allowing better
designs of the network, resulting in fewer costs.
All these characteristics can be understood as a more efficient and sustainable system
with a better quality of electricity product and a superior electricity service.
In next chapter, DG and Demand-Side Participation are described. Also an analysis
about the technological and regulatory issues affecting each of them is carried out. This
dissertation focuses on these two DERs due to their proximity in time and already on-
going process of DG integration.
The integration of the other two DERs (electric vehicle and decentralized storage) are
further in time but many of the conclusions of this dissertation can be used for their
future integration.
In next chapter, DG and Demand-Side Participation are described. Also an analysis
about the technological and regulatory issues affecting each of them is carried out. This

28
dissertation focuses on these two DERs due to their proximity in time and already on-
going process of DG integration.
The integration of the other two DERs (electric vehicle and decentralized storage) are
further in time but many of the conclusions of this dissertation can be used for their
future integration.

Regulatory Analysis for Distributed Generation and Demand-Side Participation Integration

Regulatory Analysis for Distributed Generation and Demand-Side Participation Integration

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