Integrid - Bridging the Gap

66 Flexible and transparent network access: Providing all new grid users with firm network access may be too costly and delay the connection of DER. Hence, flexible network access should be enabled so that grid users and DSOs can benefit from lower grid investment requirements. These agreements enable the DSO to manage consumption/generation to prevent or solve grid constraints and network users can be remunerated, or benefit from lower connection charges or a faster grid connection. Moreover, DER, particularly those connecting to the MV or HV grids, could be offered a menu of options with different combinations of connection costs and probability of curtailment due to local grid conditions. Lastly, regulation should enhance transparency on connection costs or available grid capacity in order to reduce access conflicts that may arise as large volumes of DER request a grid connection. Local flexibility mechanisms: Local flexibility mechanisms are needed to enable DSOs to procure the flexibility from DER. Thus, regulation should explicitly allow DSOs to procure flexibility services from grid users or third-parties managing a portfolio of flexible DER. As many implementation aspects remain unsolved, in the early stages, DSOs should be allowed to test different local flexibility market configurations, in regulatory sandboxes if necessary. Over time, flexibility markets and products may be standardized if deemed required. The long-term procurement of flexibility, e.g. year- ahead, and with a duration of several years, should be encouraged to ensure that DSOs can incorporate this possibility into their network development plans with low risk. Flexibility providers may receive a reservation payment for this long-term availability. Nonetheless, the activation price of flexibility should be determined in the short-term through market-based mechanisms. Distribution planning considering flexibility: Distribution investment plans that consider the use of flexibilities as part of the DSO toolbox should become a central tool to enhance transparency and support price review processes. The flexibilities considered may correspond to flexible connection agreements, services procured in local markets, or the expected response of grid users to network tariffs. Regulators should use these investment plans as an input to set DSO allowed revenues. Thus, the timing for preparing and submitting investment plans should be coordinated with price reviews. Furthermore, regulators should have adequate resources to evaluate these network development plans using forward-looking cost assessment methods. Learn more by listening to our webinar about new business models for distribution grid stakeholders: Remove the CAPEX bias in DSO revenue regulations - New additions to RAB can be decoupled from the actual investments - A capitalisation rate can be used to split annual allowed revenues into equivalent CAPEX and OPEX - Gradual implementation is recommended Local flexibility mechanisms - DSOs should be able to test products and market solutions in sandboxes - Long term procurement of flexibility should be encouraged to DSOs (e.g. reservation). The flexibility activation price should be determined in short-termmarket mechanisms Cost-reflective network charges & Flexible and transparent network access - Volumetric-only charges (€/kWh) should give space to a combination of energy, capacity and fixed components - Dynamic network tariffs can be used on top of the static ToU tariffs - Transparency in grid connection processes should be enhanced Distribution planning considering flexibility - Flexibilities considered may correspond to flexible connection agreements, services procured in local markets, or the expected response of grid users to network tariffs - Investment plans should be used as an input to set DSO allowed revenues