Panel on “Who Designs the Grid of the Future”
University of Texas at Austin
Austin, Texas, April 21-22, 2016
Key Attributes of Possible Designs
for Flexible Distribution System
Operation
Jeremy Lin, Katarina Knezović
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Disclaimer Statement
The views presented in this presentation and
related technical paper represent the sole views
of the authors only and do not necessarily
represent those of the authors’ affiliations.
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Agenda
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Background
What is Distribution System Operator (DSO)?
Key attributes for DSO design framework
Possible DSO designs and their comparisons
Further discussions and conclusions
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Background
*courtesy of Daniel Esteban Morales Bondy
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Background
• Proliferation of DER or DG in the near future
• RES (wind, solar), DR, DESS, EE, EV, and others
• Their high concentration can cause significant impact
on the local distribution grid
• Parallel impact on the wholesale markets
(RTO/ISO/TSO)
• New grid design is needed to value and effectively
use growing DERs
• New DSO construct!!
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What is DSO?
• Distribution System Operator/Operation:
– A new design that would value and utilize new services
from DERs effectively and efficiently
– Responsible for balancing supply and demand variations
at the low-voltage distribution system
– Management of two way power flows
– A link for agents from wholesale and retail markets
– A market mechanism in which available, feasible, costeffective DER solutions become part of distribution system
planning – a level playing field for DER vs traditional
resources
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Key Attributes for DSO Design
Flexibility
Market Administration
Operational Authority
Planning Authority
Independence
Open and Fair Access
Transparency
Interface between ISO/TSO and DSO
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Key Attributes for DSO design
• Flexibility:
– power system flexibility (operational, planning,…)
– Active participation by load customers, PVs (e.g. reactive power
capability), EVs (unidirectional/V2G)
• Market Administration:
– Administering and operating a distribution system market (energy,
capacity, ancillary services)
– Better market design can manage DER growth by proper ressource
valuations
– Aggregator for smaller resources
– Interaction with wholesale market at the transmission level
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Key Attributes for DSO design
• Operational Authority:
– To ensure short-term reliability of the distribution grid
– Clear market rules for distribution system operation
– Better to have a single entity taking a dual role for operating both
distribution system and distribution system market
• Planning Authority:
– Efficient planning of distribution network and DERs in local areas
– Creates incentives for investment in electric infrastructure with clear
policies for distribution grid expansion
– Allows both regulated and merchant investments
– Network planning in open, fair and transparent manner
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Key Attributes for DSO design
• Independence:
– Independent from any market participant and ressource owner
– No market participant should have influence on the market
– By analogy, US RTO/ISO are non-profit entities, complying to rules set
by federal regulators
• Open and Fair Access:
– Open, fair and non-discriminatory access
– Strong competition leads to the most efficient DER utilisation
– Better if DSO does not own any DERs
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Key Attributes for DSO design
• Transparency:
– Participants have free access to key market information
– Transparency on data, market admin and clearing rules, operating
cost, and system operation procedures
– Transparency on market rules: (1) how DERs can become market
participants, (2) their rights and obligations (3) termination rules
• Interface between ISO/TSO and DSO:
– Functional intersection between wholesale and retails transactions
– Aggregation of retail products to participate in the market via
wholesale/retail interface
– Clear roles, responsibilities and prioritization between ISO/TSO and
DSO
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Possible DSO Designs
Independent Distribution System Operator (IDSO) or
Distribution System Operator (DSO)
Distributed System Platform Provider (DSPP)
Transmission and Distribution Service Provider (TDSP)
European Model (evolvDSO)
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Possible DSO Designs
• IDSO/DSO (~RTO/ISO model)
– Operates and plans the distribution grid while maintaining safety and
reliability
– Provides open and transparent system access to all market participants
– Implements market mechanisms
– Allows all stakeholders equal opportunities to meet consumer electricity
needs
• DSPP (New York model)
– Operates and plans the distribution grid while maintaing safety and
reliability
– Serves as the local balancing authority (load vs. DERs)
– Procures and employs advanced distribution management system
(ADMS)
– Monetizes the value of DER products by creating market and tariff
systems
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Possible DSO Designs
• TDSP (Texas model)
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Unbundled businesses: generation, T&D, and retail sales
Regulated by PUCT to provide non-discriminatory access to the grid
Provides electricity transmission and delivery for its service area
Maintains the grid and responsible for meter-readings
TSP, DSP, or TDSP are possible
• European model (evolvDSO)
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Network planning and operation processes
Contracting flexibility services
Market facilitation
Cooperation between system operators
Active distribution system management with various defined roles
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DSO Design Comparisons
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Further Discussions
• Market power issue will be more complex
(local DERs can have market power)
• Minimum energy bid will be in low kW range
 resource aggregation needed
• Market competitiveness for a level playing
field for all market participants
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Conclusions
• Growing DERs at the distribution grid
• Need for novel DSO designs which are
effective in dealing with issues related to DER
penetration
• Key attributes for DSO design framework are
identified and presented
• Comparisons of some existing/emerging DSO
designs are made, based on these attributes
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Questions?
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