Reliability differentiation of electricity transmission

Chi Keung WOO, Ira HOROWITZ, Jennifer MARTIN

Research output: Contribution to journalArticles

23 Citations (Scopus)

Abstract

In many jurisdictions, electric utility restructuring has included the creation of an independent system operator (ISO) to dispatch generation, establish the market-clearing price, and allocate limited transmission capacity among users. This paper differentiates reliability through rate unbundling. We propose a capacity reservation tariff (CRT) to induce the users to self-select their preferred levels of reliability. Based on these self-selected reliability levels, the ISO can efficiently allocate limited transmission capacity. Our proposed CRT can be a practical solution to the transmission congestion problem faced by the California ISO in the implementation of retail access. Copyright © 1998 Kluwer Academic Publishers
Original languageEnglish
Pages (from-to)277-292
JournalJournal of Regulatory Economics
Volume13
Issue number3
DOIs
Publication statusPublished - May 1998

Citation

Woo, C.-K., Horowitz, I., & Martin, J. (1998). Reliability differentiation of electricity transmission. Journal of Regulatory Economics, 13(3), 277-292. doi: 10.1023/A:1008033221371

Keywords

  • System operator
  • Public finance
  • Industrial organization
  • Practical solution
  • Capacity reservation

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