Transmission grid access and pricing in Norway, Spain, and California: A comparative study
The openness of the transmission grid and the incentives given by transmission pricing form the foundation for retail and wholesale competition in the electricity market. The deregulated markets of Norway, Spain, and California all have introduced retail access and wholesale competition, although with different approaches to pricing of transmission grid services. This paper will briefly describe the three different solutions, and discuss some of their implications. Of the three electricity systems, Norway was the first to open the grid to competition in electricity trade. The Norwegian Energy Law of 1990 introduced open competition to wholesale and retail trade starting January 1991. In Spain, the Electricity Law of 1997 came into force early in 1998. Wholesale and retail markets in California were opened for competition on April 1, 1998, following the passage of Assembly Bill 1890, in August 1996. Introducing competition in electricity markets also implies introducing Third Party Access to the transmission grid. All potential competitors have to be given access to the grid in order to compete, no matter who owns the actual wires. This principle raises several challenges, notably, how to price transmission services. Who is to pay for which transmission services? The Norwegian grid is divided into three levels depending on its function. The transmission grid includes all parts of the national grid having a transmission function, meaning that some lower voltage levels also are included. In Spain, the definition of the transmission grid is similar, including the 400 kV and 220 kV national grid as well as lower voltage installations that could affect transmission operation or generation dispatch. For historic reasons, wholesale electricity transactions in the US are regulated by the federal government through the FERC. However, operations of utility systems within one state fall primarily under state jurisdiction. Because the utility systems in California generally are large and exchanges between them limited, the role of FERC was small prior to restructuring, although the state is a large importer of power.
- Research Organization:
- Lawrence Berkeley National Lab. (LBNL), Berkeley, CA (United States)
- Sponsoring Organization:
- USDOE Assistant Secretary for Energy Efficiency and Renewable Energy (US)
- DOE Contract Number:
- AC03-76SF00098
- OSTI ID:
- 771926
- Report Number(s):
- LBNL-46629; R&D Project: 673331; TRN: AH200108%%82
- Resource Relation:
- Conference: Power Delivery Europe '99, Madrid (ES), 09/28/1999--09/30/1999; Other Information: PBD: 1 Sep 1999
- Country of Publication:
- United States
- Language:
- English
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