Capacity pricing schemes to implement open-access rail in Tanzania

We analyze alternative capacity pricing schemes (access charges) to implement an open-access railway system in Tanzania. We show that the implementation of variable access charges widely used in the railway industry may result in levels of traffic lower than the traffic operated by an integrated railway company. We propose the use of fixed access charges to avoid this problem and discuss the main advantages and disadvantages to implement them in the context of multiple freight train services in Tanzania

Prospects for grid-connected solar PV in Kenya: A simulated economic and operational feasibility study

This paper analyzes the economic and technical potential for grid-connected solar PV in Kenya. A unit commitment model is used to evaluate the feasibility of grid-connected solar PV under different price and hydrological conditions in the years 2012 and 2017. In the model, Kenya’s extensive reservoir hydro system compensates for daily and seasonal solar intermittency, eliminating the need for investment in battery or other storage capacity. Results show that in the 2012 system the economic value per kW installed of high penetrations of solar PV is greater than the expected revenue under the existing Kenyan feed-in-tariff. This is because solar displaces more expensive fixed and leased fuel oil generation. Evaluation of solar PV under three possible generation mix and demand scenarios in 2017 reveals that the value of solar remains above revenues from the offered feed-in-tariff only if planned investments in low-cost geothermal, imported hydro, and wind power are delayed. The paper focuses on solar investment and no attempt has been made to estimate the theoretical optimal mix. We do not take into account differences in transmission investment associated with different types of generation, which seem likely to favor solar PV in most planning scenarios, nor do we assign monetary value to avoided carbon emissions. The methodology can also be used to estimate the potential for solar and other renewable deployment in many other African countries whose generation capacity is reservoir hydro dominated, or where baseload capacity is provided by costly fossil fuels such as diesel, kerosene, or liquefied natural gas

Modeling Unit Commitment in Political Context: Case of China's Partially Restructured Electricity Sector

Restructuring an electricity sector entails a complex realignment of political and economic institutions, which may both delay and distort the achievement of satisfactorily competitive conditions. In research and planning for policy interventions in power systems under these varied regulatory environments, typical operational models may neglect important interactions between techno-economic criteria and political constraints, leading to poor understanding of underlying causes of inefficiency and to inappropriate recommendations. We develop tractable formulations of the unit commitment problem based on integer clustering of similar units that endogenize important political factors in the Northeast grid region of China. We demonstrate the importance of these interactions on operations and provide a set of options for researchers to explore further pathways for China's ongoing power system reforms. For example, wind integration, a key policy priority, is inhibited by the interaction of institutions limiting short- and long-term sources of flexibilities in interprovincial trade

Restructuring revisited part 2 : coordination in electricity distribution systems

Published 2019This paper addresses the mechanisms needed to coordinate vertically and horizontally disaggregated actors in electricity distribution systems. The mechanisms designed to coordinate planning, investments, and operations in the electric power sector were designed with minimal participation from either the demand side of the market or distributed energy resources (DERs) connected at distribution voltages. The emergence of DERs is now animating consumers and massively expanding the number of potential investors and participants in the provision of electricity services. We highlight how price signals-the primary mechanism for coordinating investments and operations at the transmission level-do not adequately coordinate investments in and operations of DERs with network infrastructure. We discuss the role of the distribution system operator in creating cost-reflective prices, and argue that the price signals governing transactions at the distribution level must increasingly internalize the cost of network externalities, revealing the marginal cost or benefit of an actor's decisions. Price signals considered include contractual relationships, organized procurement processes, market signals, and regulated retail tariffs. This paper is the second part of a two-part series on competition and coordination in rapidly evolving electricity distribution systems

Restructuring revisited part 1 : competition in electricity distribution systems

Published 2019This paper addresses the implications of the emergence of distributed energy resources (DERs) for competition in the electricity distribution systems. The regulations on industry structures in place today were designed in an era characterized by centralized resources and relatively price inelastic demand. In light of the decentralization of the power sector, regulators and policy makers must carefully reconsider how industry structure at the distribution level affects competition, market development, and cost efficiency. We analyze the economic characteristics of distribution network owners and operators, DER owners, and aggregators and retailers. We translate the foundational theories in industrial organization and the lessons learned during the previous wave of power system restructuring to the modern context to provide insight into three questions. First, should distribution system operations be separated from distribution network ownership in order to ensure the neutrality of the DSO role? Second, should DNOs be allowed to own and operate DERs, or should DER ownership be left exclusively to competitive actors? Third, does the emergence of DERs necessitate a reconsideration of the role of competition in the provision of aggregation services such as retailing? This paper is the first part of a two-part series on competition and coordination in rapidly evolving electricity distribution systems