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Research Symposium European Electricity Markets
AER/CPB/ECN The Hague - September 2003
INNOVATIONS IN ELECTRICITY NETWORKS
Rolf W.Künneke
Faculty of Technology, Policy and Management
Delft University of Technology
P.O.Box 5015
2600 GA Delft
The Netherlands
Abstract
This paper reflects on the incentives for innovation in electricity networks and the resulting re-
quirements for future network structures. It appears that there are some significant empirical de-
velopments that fundamentally challenge the existing structure of the present energy system.
The liberalization of energy markets, innovative technological opportunities especially in the
fields of ICT and power electronics, and changing political preferences towards environmental
objectives provide strong incentives for system changes. From an analytical perspective, there is
presently a mismatch between the technological governance of networks and the economic allo-
cation process. It is argued that this mismatch needs to be resolved, in order to safeguard the
sustainability of the energy system.
1. INTRODUCTION
Networks are the backbones of the electricity system. They physically connect electricity pro-
ducers and consumers and contribute to vital services such as load management, technical dis-
patch, handling of emergencies, metering & control of energy and capacity according to speci-
fied technical standards. Electricity networks developed in little more than 100 years from
primitive local grids to complex international networks that interconnect numerous countries
over great distances. For example in continental Europe, the ‘Union for the Co-ordination of
Transmission of Electricity" (UCTE), coordinates the physical connection of the transmission
networks of more than 20 countries, securing the energy supply of some 450 million people.
Economies of scale and a greater technical reliability of the system were the most important
drivers for this remarkable process of an ever-growing scale of network operation. Nowadays,
customers in many industrialized countries enjoy a very reliable supply of electric energy and
take it for granted. As a consequence, there is a high dependency on an undisturbed availability
of electric energy.
Traditionally electricity systems strongly depend on the capabilities of the high voltage trans-
mission network to co-ordinate and facilitate a centralized electricity supply. In these systems
electricity generation is concentrated in large-scale production units with a one-directional de-
livery to the final customers. Innovations in these systems are predominantly directed towards a
better utilization of the existing capacities. This technological evolution of the current system
will not be addressed in this paper. However, the emphasis is on possible developments that re-
sult in a fundamental change of existing network structures. It will be demonstrated that under
the current conditions of competitive electricity markets, there is growing economic and techni-
cal need for a radical change towards more decentralized energy systems that strongly rely on
distributed generation and decentralized monitoring and control of networks.
Research Symposium European Electricity Markets
The Hague - September 2003 AER/CPB/ECN
In order to allow the development of such a system, fundamental technical and economic inno-
vations are needed. The overall research question of this paper can be summarized as follows:
What are the incentives for innovation in electricity networks and the resulting requirements for future network structures in competitive electricity markets?
The second paragraph summarizes some empirical developments that challenge the existing
network structures. Consequently paragraph 3 addresses the need for changing network struc-
tures from a theoretical perspective. It will be argued that there is a fundamental mismatch be-
tween the economic and technical governance in the electricity sector. This indicates a need for
innovations. Paragraph 4 discussed some requirements for future network structures that fit the
needs of competitive markets. Some concluding remarks are summarized in paragraph 5.
2. INCENTIVES FOR INNOVATION
In the past two decennia the energy industry was confronted with remarkable developments that
challenged its traditional technical structures. These challenges developed as a consequence of
changing market conditions1, shifting political preferences
2 and new technical opportunities
3.
Some prominent examples include:
• The increasing significance of distributed generation;
• Emerging demand for product differentiation and flexibility;
• Need for new investments in the energy system;
• Vulnerability and an expected decreasing reliability of the current system;
• Preference for sustainability and environmental protection.
As will be demonstrated below, these developments are more or less interrelated. This list of
examples is not exclusive, but only demonstrates the technological challenges the present elec-
tricity system is confronted with.
2.1 Distributed generation
Distributed generation certainly belongs to the most important drivers for innovations in net-
works. Distributed generation can be defined as .. “a power source connected directly to the dis-
tribution network or on the customer side of the meter”4. Typically these power plants are quite
small scale and in many cases primarily serve the needs of a predetermined group of customers.
Presently distributed generation (DG) is typically applied in greenhouses, industrial sites, hospi-
tals or commercial buildings. Because of its small size these production units are often not re-
quired to contribute to the system balance. The net code of The Netherlands, for instance, ex-
cludes generation units of less than 60 MW from the obligation to offer system balancing capac-
ity to the transmission system operator.
Distributed generation can be based on various technologies, ranging from diesel generators;
gas fueled combined heat- and power plants; small hydro power plants; wind turbines; solar
cells; to fuel cells. Interestingly, many environmentally friendly generation technologies fit into
this category. The use of renewable energy sources like wind- and solar energy is often most at-
tractive in combination with small scale local generation units. It is generally expected that fu-
ture energy systems have to rely more on those renewable energy sources. First, it helps to real-
1 The most outstanding change of market conditions in this period was the so-called liberalization of the
electricity sector. 2 In the EU countries more emphasis is put on environmental policy, specifically CO2 reduction. 3 This includes for example ICT technologies and power electronics. 4 Akkermann, et. al.
Research Symposium European Electricity Markets
AER/CPB/ECN The Hague - September 2003
ize the ambitious environmental targets of many governments, like for example documented in
the Kyoto protocol on CO2 reduction. Second, the traditional energy sources like oil, gas, and
coal are steadily diminishing and need at least some replacement at the longer term. Another
important driver for the increasing use of distributed generation is its improving cost economics
Various DG technologies, like wind and CHP, are becoming increasingly competitive as com-
pared to the traditional means of large scale electricity generation. 5
A possibly increasing use of distributed generation has quite fundamental consequences for the
existing network structures. In order to elucidate this argument, it is necessary to explain some
important differences between distribution- and transmission networks.
In conventional electricity systems, distribution and transmission networks serve different pur-
poses. Transmission networks connect generation devices, balance load differences, enable a
bi-directional flow of energy, safeguard the overall system stability and power quality, and al-
low for various monitoring and control activities. Normally the technical integrity of energy
systems is safeguarded predominantly through the transmission system operators. In Europe,
transmission networks have a typical morphology as mashed design, which adds additional re-
dundancy to the system and thus improves its reliability.
On the other hand, distribution networks are designed to facilitate a unidirectional power flow
from high voltage transformers to the final consumer. The network morphology has a radial or
loop design, which results in little redundancy and thus a potentially higher sensitivity for sys-
tem faults. Typically there are only very limited metering or control devices that allow
influencing the use of the networks or the flow of energy. Because of this lack of active control
mechanisms, these systems are sometimes attributed as ‘passive networks’.6
Integrating distributed generation into these existing network structures leads to some funda-
mental technical problems. A recent study on the likely changes of network design as a result of
a significant application of distributed generation comes to the following conclusions:7
• Protection and islanded generation: Under current conditions, distributed generation can
only function properly in a technical stable distribution network. In order to be able to fully
exploit the advantages of DG, intelligent protection and controls need to be introduced that
allow DG generators to function even in de-energized networks.
• Generator and network communication systems: Distribution grids need to be transformed
into active networks that allow for harmonized system control and communication schemes
between various generators and final users.
• Voltage regulation: DG influences the voltage level in distribution networks. In order to
guarantee a certain power quality, new technical devices (so-called tap changers) have to be
implemented in the grid. It has to be considered whether existing networks can be operated
at a higher voltage level in order to meet the increasing capacity requirements.
• Network configuration: Since the role and function of distribution networks changes, the
present radial network structure does not suffice any more. A stronger interconnected sys-
tem is recommended. Operators should consider DG as part of an integral network design
approach.
• Ancillary services: More active and dynamic distribution networks need to facilitate various
unbundled ancillary services that support various DG technologies. The integration of DG into existing networks is technically very challenging. This is illustrated
by the numerous R&D programs that are developed all over the world to stimulate research in
this area.8
5 Kema , p. 42 ff. 6 Beddoes & Collinson. 7 Beddoes & Collinson.
Research Symposium European Electricity Markets
The Hague - September 2003 AER/CPB/ECN
2.2 Emerging demand for product differentiation and flexibility
In the past years an interesting discussion developed about the possible need or desirability of
product differentiation even with respect to the delivery of electric energy. A study about the
economic value of load losses9 in The Netherlands reveals interesting differences between sec-
tors and regions in this country (figure 1). The study even analyzed the economic consequences
of lost load for the different regions of The Netherlands. Not surprisingly, areas with high eco-
nomic activities that are located in the western part of this country have the highest value of lost
load.
Figure 1: Value of lost load in The Netherlands10
Sector Value of lost load
(€/ Kwh)
Households 16,4
Agriculture 3,9
Energy industry 0,3
Industry 1,9
Building industry 33,1
Transport 12,4
Services 7,9
Government 33,5
Average 8,6
Figure 1 illustrates the differences in the willingness to pay for different groups of customers.
Under market conditions, this results in product differentiation and accordingly different prices.
As a consequence, economic efficiency increases, because customers with a higher valuation
will acquire more form this good or service. For the energy sector, product differentiation was
traditionally not an issue. In general, energy networks are only capable to deliver the same qual-
ity to all final customers. However, allowing for product differentiation in electricity networks,
not only offer new business opportunities, but also contribute to a more efficient technical utili-
zation of the energy system. Technical upgrades and the allocation of network capacity could be
attributed to customers and/ or service area’s according to the actual technical and economic
needs. Under the present conditions, this is not possible.
2.3 Need for new investments in the energy system
There is an increasing public concern about the increasing investment needs in energy systems,
both in generation and networks, and the probable incapability of the restructured energy busi-
ness to meet these needs.11
The recent blackout in the USA demonstrated that the networks in
this country are poorly maintained and urgently need significant investments. There are also
significant investment needs in networks in European countries. For example in The Nether-
lands, quite some investments date from the sixties of the past century. After 40 years, upgrades
or replacements are needed. Figure 2 illustrates the replacement needs for the next 40 years in
the electricity networks in The Netherlands.
8 For a recent overview of R&D in Japan,. USA and EU see for example Watson et. al. 9 Bijvoet et.al. 10 Bijvoet et.al., p. 46. 11 IEA 1999.
Research Symposium European Electricity Markets
AER/CPB/ECN The Hague - September 2003
Figure 2: Replacement needs for electricity networks in The Netherlands12 (in number of components x 1.000)
There is also a significant need for capital expenditures in generation capacity (figure 3). In
OECD Europe, about 16% of GDP needs to be invested in new electricity plants between 1995
and 2020. In other regions of the world this investment need is even higher.
Figure 3: Capital expenditures on new generating plant (billion US $, 1990 values)13
Years/ Regions 1995-2000 2000-2010 2010-2020 1995-2020 % of GDP
1995-2020
OECD Europe 76 117 174 367 0,16
OECD North
America
54 99 155 308 0,14
OECD Pacific 45 99 155 308 0,41
FSU/ECE 25 153 210 388 0,75
China 97 253 385 735 0,37
Rest of the
world
167 409 509 1085 0,31
World 463 1181 1613 3257
% of GDP 0,28% 0,28% 0,29% 0,28%
An OECD report concludes that public resources are expected to be insufficient to meet these
enormous capital requirements. Hence, private sector involvement is needed, not only to raise
funds, but also to increase efficiency14
: ‘Private sector involvement brings not only financing, but also market oriented management skills, access to the latest technology, and usually quicker implementation than would be the case under public sector management.’ These investment
needs create opportunities for innovations in electricity generation and networks.
Since the restructuring of electricity markets, the risks attributed to new investments are signifi-
cantly higher than prior to the reform. Next to the contingencies of future markets, there is con-
siderable regulatory risk. There are still quite some disputes and uncertainties about the future
regulatory regimes that not only support the development of competitive electricity markets, but
also guarantee fundamental social services. In this environment, long-term investments with
substantial capital needs are difficult to realize. Under these conditions technologies with lower
investment needs and a short pay back period are more favorable. Besides, these technologies
might even allow for a greater flexibility and adaptability with respect to the demand and neces-
sities of the future. DG fits quite well to these requirements. This is certainly an important rea-
son for the growing preference of investors for small-scale technologies in the energy sector.
12 NRC Handelsblad 8-2-2003, p. 2 13 IEA, p.84 14 IEA, p. 85
Research Symposium European Electricity Markets
The Hague - September 2003 AER/CPB/ECN
2.4 Vulnerability and a probable decreasing reliability of the current system
Electricity outages are news events, with the recent blackout in the eastern part of the USA as a
‘highlight’. There is a growing public concern about the reliability of the electricity infrastruc-
ture and the possibly insufficient incentives of the restructured markets for short- and long-term
investments. Investments in distributed generation and active networks offer new perspectives
to overcome these problems. Compared to the present system, a more direct relation between
cost and benefits can be expected. Individual investors might bear the costs, but they are also
able to reap the benefits, especially in times of a crisis.
There is also another dimension to the problem. After the terrorist attacks in the USA, Septem-
ber 11th 2001, very quickly the link was made to the vulnerability of electricity system. “Seen
through the eyes of a terrorist, building more fossil fuel power plants and nuclear reactors looks pretty naive. By contrast, distributed renewable energy systems, such as rooftop solar photovoltaic systems, small wind turbines, and fuel cells not dependent upon fossil fuel, sudden appear enlightened.”15
The US Department of Energy develops a growing interest in decentral-
ized electricity systems. However, in Europe this is not brought forward as a significant argu-
ment.
2.5 Preference for sustainability and environmental protection
As already mentioned earlier, many DG technologies support the preference for sustainability
and environmental protection. Politically this is an important argument to stimulate the devel-
opment of alternative electricity systems. At least in the EU it is widely accepted that there is an
urgent need for environmental protection. For this reason many countries promote the use of
renewable energy sources that are often attributed to DG.
3. THE NEED FOR CHANGING NETWORK STRUCTURES
The previous paragraph clearly demonstrates that there are quite some practical reasons to as-
sume that innovations in the electricity sector are necessary. Small scale electricity generation
receives quite some attention in literature and is certainly an important driver for changes in
network structures. There is however anther more generic reason to assume that innovation in
electricity networks is inevitable. At present, there is a striking mismatch between the technical
and the economic governance structures of the electricity system. As will be discussed in this
paragraph, changing network structures can contribute to solve this inconsistency and hence
contribute to the sustainable development of genuine competitive energy markets.
One of the vital aspects of the restructuring of the energy market was the introduction of compe-
tition in production and supply, while maintaining strongly regulated monopolistic networks.
Production and supply are considered as commercial activities that can be allocated by market
forces. However the network is perceived as a given technical structure that needs to be pre-
served even under these new circumstances. It is often argued that networks are natural mo-
nopolies that are needed to safeguard the technical integrity and reliability of the electricity sys-
tem. As a result regulatory regimes have to put a lot of effort in creating institutional arrange-
ments that serve the needs of a centralized technical control of networks, while allowing for
competition in production and supply. The reasoning in this paragraph is divided into three
steps. First the inconsistencies within the present system will be addressed. Second, very briefly
some technical opportunities for the development of new network structures are mentioned.
Third, a brief insight is given about the present state of redesigning electricity networks.
15 Asmus, p.75.
Research Symposium European Electricity Markets
AER/CPB/ECN The Hague - September 2003
3.1 Inconsistencies within the present system
From an economic perspective, the allocation of goods or services within physical networks can
be characterized by four vital features:16
• Unit of decision making: i.e. individual, group or public authority;
• Mechanism of allocation: price, agreement, or directive;
• Dominant economic goal: individual profitability, collective profitability, or national public
interest;
• Degree of complementarity between network nodes and links, with as extreme cases: com-
plete independence or complete complementarity.
Based on these features, figure 4 compares the technical governance of networks with the eco-
nomic allocation of energy.
Figure 4: Technical governance of networks versus the economic allocation of energy
Technical governance Economic allocation
Unit of decision making Public or private authority Individual
Allocation mechanism Agreement or directive Price
Dominant objectives Public interests Individual profitability
Degree of complementarity High Low
• Unit of decision-making.
In the liberalized parts of the electricity markets (primarily production and supply) individ-
ual decisions are the basis for producing, trading or consuming electric energy. There are
ample of institutional arrangements to match supply and demand for electricity, including
bilateral contracts, power pools or even integrated firms. These mechanisms are all well
know from other sectors. However, the governance of technical structures of the electricity
sector has to comply with the physic of electricity. The network physically connects power
plants and loads (i.e. consumption), with frequently changing physical characteristics. The
network capacity is a function of the changing configuration between the power production
and loads. As a consequence the operational capacity of networks is variable with shifting
bottlenecks17
. In addition, real time balancing is required because electricity can not be
stored. These physical features require a public or private authority to safeguard the techni-
cal integrity of the system. Even on the longer term, individual end users have no economic
incentive to invest in the network capacity, because this has strong public good characteris-
tics. Accordingly, an authority is needed to take care of these long-term investments and
share the costs among the users. Although individual market parties can certainly make
claims on network use based on contractual arrangements and price signals, the final techni-
cal allocation needs to be taken care of by an authority, i.e. the system operator.
• Allocation mechanism.
The allocation of supply and demand is based on the price mechanism. For the technical al-
location of resources some regulatory agreement or directive is needed. Network access and
the technical terms of use are regulated by an authority, documented for example by a net-
work code and specific regulations for access and pricing.
• Dominant objectives.
There are also interesting differences with respect to the dominant objectives. Economic ac-
tors are assumed to serve their individual goals, whereas the technical operations of the
network have to serve national interests and/ or public service obligations, including reli-
ability, security of supply and affordability.
16 Arentsen & Künneke, p.543 refer to the first three characteristics. 17 See Budhraja, p.55, 56.
Research Symposium European Electricity Markets
The Hague - September 2003 AER/CPB/ECN
• Degree of complementarity.
In a technical sense, the nodes and links of electricity networks are highly complementary.
They all need to be technically coordinated in a certain way in order to allow the transport
of electricity from producers to consumers. The price mechanism however, does not suffi-
ciently reflect this complementarity. Distance dependent transport costs might be allocated,
but this only partially reflects the technical system interdependencies. Under most ideal
market conditions, there is no complementarity at all.
As a conclusion it can be stated that in liberalized markets the technical governance of electric-
ity networks does not support the economic allocation process, and vice versa. This complicates
the technical operation of electricity networks and frustrates the development of proper eco-
nomic signals that support the functioning of markets. Some of the consequences for this mis-
match are discussed in the previous paragraph. It is beyond the scope of this paper to analyze
the various conflicting economic incentives and physics of electricity networks in detail. In this
respect certainly some research is warranted. Just as a reminder, it has to be mentioned that
there was no such fundamental difference between economic a technical governance in the tra-
ditional electricity market since both were mainly oriented towards hierarchical control mecha-
nisms.
3.2 Technical opportunities for new network structures
There are various technology drivers that enable the technical development of new network
structures.18
ICT technologies allow for new approaches to generate and coordinate information
that are far beyond the traditional centralized model. Power electronics provides among others,
interesting control and monitoring devices that enable the development of active or intelligent
networks. Micro-processor based electrotechnologies can contribute to precision advantages and
improve efficiency (smart technologies). The development of advanced materials offers a wide
range of new opportunities, for example with respect to energy storage, or the improvement of
devices for photovoltaic cells. Without going into further details, this clearly indicates that there
are technical opportunities to reshape existing electricity networks that support a stronger com-
pliance of technical and economic governance structures. However, these technical opportuni-
ties need to be further developed, as illustrated by the world wide R&D efforts in these fields.19
3.3 Present state of redesigning electricity networks
An inventory on recent studies and projects in the field of innovative network approaches 20
demonstrates that far most of the initiatives are in the phase of design and strategic orientation
and that there is only very little practical experience. Some practical experience is only available
in remote areas that are traditionally excluded from the centralized energy provision. However,
there are already some major suppliers that offer concrete products in this field, including ABB,
Siemens and Sandia. ABB offered micro grids for some years, but this was commercially not a
success. Apparently innovations in networks do not develop strait forward. Seemingly there are
significant barriers for these new technologies that need to be addressed.
18 Kema, p.27, 28. 19 See for example the research agenda on: Network integration of distributed generation, in the Dutch
IOP EMVT research program, www.senter.nl. 20 Künneke & Runhaar.
Research Symposium European Electricity Markets
AER/CPB/ECN The Hague - September 2003
4. REQUIREMENTS FOR FUTURE NETWORK STRUCTURES
The analysis suggests that a sustainable energy system can only be achieved if the technical and
economic governance structures support each other. As there are presently quite some inconsis-
tencies between both, realignment seems to be unavoidable. In general, this realignment can
point into two different directions: a modification of either the economic allocation or the tech-
nical governance. The recent restructuring of the electricity market resulted in a fundamental
reform of the economic allocation, while the technical governance basically remained un-
changed. As two extreme cases, either the technical governance has to change according to the
new economic needs, or the economic allocation mechanism has to be realigned according to
the technical possibilities of the current energy system. A change of the economic allocation ac-
cording to the present technical governance will result in a structure that is most probably quite
similar to the traditional energy system. The analysis in this paper focuses on the other extreme,
i.e. the necessary changes with respect to the technical governance to support the economic al-
location mechanism in a liberalized electricity market.
Starting from this assumption, the desirable features of the technical governance can be derived
form the scheme in figure 4:
• Unit of decision making: individual;
• Allocation mechanism: price;
• Dominant objective: individual profitability;
• Degree of complementarity: low.
Translating these features into technological concepts of future distribution networks is not
straightforward. Again, there is a wide range of options that still has to be explored. The follow-
ing only serve as examples.
Decentralization of electricity production
Electricity networks might be abolished at all. Individual customers become self-reliant with re-
spect to electricty. They might either depend on other primary energy sources like natural gas or
hydrogen for the local production of electricity. As another option sustainable energy produc-
tion from wind or solar cells might cover most local needs.21
Self-reliant customers take indi-
vidual decisions about production and consumption of electricity, according to their individual
objectives. They are able to respond to possible price signals with respect to the allocation of
energy. Under these circumstances the technical complementarity will be low, because produc-
tion and consumption of electricity are physically at the same location. This is the most far
reaching case of a decentralized energy system.
Network intelligence
Networks might become more intelligent by developing inherent capabilities to operate within
secure technological margins while maintaining a maximum transport capacity. Under these
conditions no centralized system operator is necessary. An information system needs to be in
place that generates prices in accordance with the relative scarcity of network capacity. Under
most ideal circumstances, this information would be generated by an autonomous market proc-
ess. The use of networks is dependent on price signals and according to the individual utility or
profitability. In order to realize a lower degree of complementarity and to allow for economic
choice, it appears inevitable that customers have at least some access to individual power pro-
duction and/ or storage in combination with possibilities for demand side management.
21 Patterson.
Research Symposium European Electricity Markets
The Hague - September 2003 AER/CPB/ECN
Network morphology
Like Internet, electricity networks can be operated in small, semi independent units that are in-
terconnected by a back bone. The ‘energy web’22
or the micro grid concept23
are examples for
this approach. ‘The MicroGrid structure assumes an aggregation of loads and microsources op-
erating as a single system providing both power and heat. The majority of the microsources
must be power electronic based to provide the required flexibility to insure controlled operation
as a single aggregated system. This control flexibility allows the MicroGrid to present itself to
the bulk power system as a single controlled unit, have plug and play simplicity for each micro-
source, and meet the customers’ local needs.’ This concept is based on an innovative network
morphology that consists of small semi-independent networks that are connected by a backbone.
Within these micro grids a limited number of producers and consumers combine their electricity
needs. Under these circumstances the unit of decision making is not strictly the individual, but a
small group of actors that strive to realize common objectives. The degree of complementarity
is certainly lower than under present conditions. The degree to which price signals can govern
the technical use of the systems depends on its inherent intelligence.
It appears that the above mentioned requirements for future network structures can be realized
by different technological concepts. Compared to the present system, one of the most vital chal-
lenges seems to be the technical decentralization and down-scaling of generation and network
operation.
5. CONCLUSIONS
This paper reflects on the incentives for innovation in electricity networks and the resulting re-
quirements for future network structures. It appears that there are some significant empirical de-
velopments that fundamentally challenge the existing structure of the present energy system.
The liberalization of energy markets, innovative technological opportunities especially in the
fields of ICT and power electronics, and changing political preferences towards environmental
objectives provide strong incentives for system changes. From an analytical perspective, there is
presently a mismatch between the technological governance of networks and the economic allo-
cation process. It is argued that this mismatch needs to be resolved, in order to safeguard the
sustainability of the energy system. The present economic restructuring of the energy markets
can only be sustained, if the technological structures are modified towards a strong decentraliza-
tion of the technical governance of networks and production capacity in combination with de-
mand side management.
This conclusion raises many questions for subsequent research. What are the opportunities for
change within the present system? The path dependency of the present energy system might
create barriers for the development of alternative systems, or even might prevent this. What are
the challenges for industry and regulation to deal with the above mentions developments? How
could a possible transition be facilitated? What is the possible time period in which such a tran-
sition could take place: twenty years from now or just two years? Referring to the experiences in
other infrastructures, especially ICT, some developments are evolving quite unexpectedly and in
an unanticipated pace. In the past the energy system was characterized by a high degree of sta-
ble technological development and solid economic growth. However, the above mentioned de-
velopments challenge this pattern quite fundamentally.
22 Bonnaville Power Authority, www.bpa.org. 23 Consortium for Electric reliability Technology Solutions.
Research Symposium European Electricity Markets
AER/CPB/ECN The Hague - September 2003
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Research Symposium European Electricity Markets The Hague - September 2003 AER/CPB/ECN