Electricity North West Limited
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Network Innovation Allowance
ED - Network improvements and system operability
Identification of the VoLL multiplier effect, the socialisation of investment costs and the practicalities of implementing a revised model.
Phase A – strategy:
· Optimise the VoLL decision making tool by providing guidance on the appropriate combination of VoLL drivers and the requisite level of sophistication and aggregation.
· Identify, evaluate and incorporate appropriate forecasting features to future proof the model / demonstrate stability/variability over time.
· Deliver an understanding of the relative value of investment to prevent an event vs that of managing the consequence of the event.
· Undertake analytics to identify the appropriate network scale to which the differentiated VoLL value should be applied.
· Develop sample investment plans to understand options for implementation and potential impact on affordability and quality of outcomes for different customer segments.
· Engagement with key industry stakeholders to identify implications, formalise an appropriate VoLL decision making tool and establish a strategy for transition to national implementation, identifying regulatory mechanisms currently or potentially driven by a VoLL function.
Phase B – customer:
· Determine the increased sense of equity and DNO service provision that can be achieved through implementation of a differentiated VoLL model.
· Quantify the impact of scale and duration of an outage on VoLL
· Deliver an understanding of the societal value of investment to prevent an event vs that of managing the consequence of the event
· Measure societal acceptance of a differentiated VoLL model, segmented by customer need
· Substantiate which segments are perceived by society to have the greatest need
· Quantify the likely effects of a differentiated VoLL investment model on society, now and in the future.
The scale of financial benefits to customers will be a key deliverable from the research – Customers will inform us of the VoLL and therefore what appropriate compensation would be for accepting a lower level of reliability.