Supply Quality Regulation - Its Influence over Short-Term Investment Decisions in Distribution Networks

Abstract

This paper evaluates the influence of supply quality controls of a performance-based regulation over the prioritization of short-term investment decisions in distribution networks. Since the uncertainty in planning parameters is considered by means of fuzzy numbers, the fuzzy performance and fuzzy financial analysis are conducted. Then, the respective prioritization process is accomplished by means of a method for ranking fuzzy numbers. The results show that the prioritization process is highly dependent on the supply quality control that the regulations applied. Moreover, depending on the level of the supply quality penalization, the distribution utilities may or may not be encouraged to invest in the maintenance or improvement of the supply quality. What is more, the regulations may not support the distribution utilities to make better investment decisions. The aforementioned is illustrated through the respective examples, numerical results, and conclusions.