May 2008
Intermediate to advanced
340 pages
9h 41m
English
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7.2 ELECTRICITY MARKET STRUCTURE
The ‘electricity market’ is a rather broad concept that covers all aspects between the production/import and the consumption/export of electricity. Electric energy as a product can be separated commercially from transmission as a service and this leads to a ‘market’ structure as shown in Figure 7.1: production and supply are organized as a market, whereas the transmission and distribution of electricity are monopolistic activities. The square entitled ‘market’ at the left-hand side of Figure 7.1 refers to a market in the economical context: a ‘market place’ where trading takes place.
Transmission and distribution
The entities involved in the transmission and distribution of electricity (the square at the righ-thand side of Figure 7.1) are now briefly described.
Grid companies own parts of the transmission and/or distribution networks and facilitate the transmission and/or distribution of electricity efficiently, at low operating cost and with a high reliability. They have the duty to operate, maintain, renew and extend the network if this is necessary. Also, the handling of congestions, and taking care of the power quality are included in their service. The transmission and distribution of electricity are monopolistic activities: there is only one (interconnected) electric infrastructure of which the various parts are owned by different network companies. This makes a regulatory authority (being a governmental body) necessary to watch over the independence ...
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