Econonomics of Energy and Environmental Policy

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Balancing between competition and coordination in smart grids - a Common Information Platform (CIP)

The commercial value added in electricity distribution networks and smart grids is increasing. Concerns about competition on a level-playing field are raised. The debate on vertical network unbundling is reaching the distribution networks. Primary driver for this discussion is the requirement to exchange information in smart grids in a neutral and non-discriminatory way. Against the background of the unbundling discussion for distribution networks, we introduce a new approach: the Common Information Platform (CIP). The CIP tries to balance better between competition and coordination. The CIP adds two new dimensions. First, it "unbundles" information and data management as the key step in the value chain. Correspondingly, the CIP avoids such drastic measures as network ownership unbundling and legal unbundling will suffice. Second, it does not "separate" information and data management from the sector, but rather involves third parties in the rule-making process; the governance structure is "common" instead of "independent".
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JEL Codes:L94: Electric Utilities, L51: Economics of Regulation, D02: Institutions: Design, Formation, Operations, and Impact

Keywords: power systems, power distribution, information and data management, smart grid

DOI: 10.5547/2160-5890.6.1.cbra

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Published in Volume 6, Number 1 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.


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