IEEE Power & Energy Magazine - January/February 2015 - 58

of those systems should refrain from this activity. Other EU
member states have opted for financing of all energy R&D
related aspects through national research programs, with the
responsibility for implementation being delegated to national
energy agencies or similar types of organizations. In other countries, accountability is high on the list of priorities for regulators, resulting in a push toward the use of EC funds, which are
perceived as transparent and stringent mechanisms for financing
and therefore "safe" from their perspective. Furthermore, not all
NRAs are following research and demonstration activities and,
consequently, there is not enough knowledge at the regulator
level to pursue the necessary regulatory reform in such a way
that the regulators can feel confident and comfortable.
More than mere compensation for the services provided
to the system, including innovation, fair compensation is
needed. NRAs need to implement suitable financial compensation frameworks that combine national, European, and
international R&D funding with national tariffs and are capable of guaranteeing:
✔✔ dedicated TSO-DSO frameworks for coordinating
the R&D activities that are open to other stakeholders
and, when relevant
✔✔ the possibility of covering 100% of DSO-TSO expenses.
Although it is positive that, for example, the Council of
European Energy Regulators (CEER) periodically reviews and
reports on the state of play of regulatory approaches to smart
grids, the EC, the EU member states, the Agency for the Cooperation of Energy Regulators (ACER), CEER, and the NRAs
could jointly develop mechanisms to encourage R&D activities carried out by network operators. Furthermore, regulators
could implement adequate remuneration mechanisms for those
demonstration projects recognized as necessary for testing new
technologies on-site and developing functional knowledge for
use in the future electricity system. ACER could play a decisive role in promoting appropriate pan-European remuneration
mechanisms by harmonizing and/or aligning at the European
level national legal and regulatory frameworks. In fact, the recognition by the NRAs (potentially pushed by ACER and CEER)
of the need for R&D expenditures in the power system would
lead to a significant improvement of the current situation.
The positive results of such changes would be felt almost
immediately, since transmission and distribution companies
would be able to set the foundations for their future projects and
be able to invest in new staff with the skills and the experience
necessary to manage R&D activities and the ability to identify
promising topics, develop strong relationships with partners,
manage research programs, and disseminate the results.

Three Courses of Action for TSOs and DSOs
In the face of this mismatch between expectations and the
means to meet them, TSOs and DSOs are continuing to campaign for the necessary changes to rules, but in the meantime
they must do their best to enable the changes that will bring us
closer to future-ready grids. Three possible ways in which network operators could do this are detailed below.
58

ieee power & energy magazine

Combining All Financing Instruments
at the EU and National Levels

First, TSOs and DSOs will continue to make the best use of the
financing instruments available at the national and European
levels. The EC's R&D funding framework, Horizon 2020, has
increased the amount available for energy projects for the period
2014-2020 in comparison with the previous period, making
available €5.4 billion for nonfossil fuel energy research. Energy
networks are at the core of these calls for proposals, with actions
enhancing the support for the energy networks and for the integration of various technologies into the system being prioritized.
As an indication of the budgets available for electricity networks
in the period 2014-2015, €80 million was benchmarked for
transmission grids and €60 million for distribution grids.
The EC very recently amended its rules on state aid, making it possible for governments to fund up to 100% of energy
infrastructure projects. The EC's new regional policy framework
for 2014-2020 is also supportive of spending on electricity infrastructure projects. This said, the use of the policy's funding mechanism, the European Structural and Investment Funds, for this
purpose relies on the member states' indicating their intention to
do so from the outset of the seven-year funding period, through
their partnership agreements-which the majority have not done.
Other funding has been made available through the Connecting Europe Facility (CEF), the funding mechanism linked to
the Trans-European Networks for Energy (TEN-E) regulation.
The CEF stipulates that only projects that make it through a first
screening process will be awarded the title "project of common
interest," or PCI, and eligible to apply for the second round, which
will determine actual funding. Other EU financing opportunities
have been made available, through the New Entrants Reserve
300 (NER300) and KIC-InnoEnergy programs among others,
via low-interest borrowing from the European Investment Bank
and the European Bank for Reconstruction and Development,
and new financing mechanisms are being developed and tested,
such as the Project Bonds initiative and the European Long-Term
Investment Funds.
There is, however, no coherent system of incentives for
bringing the tested solutions into the market, mainly due to the
fact that there is no link between this financing framework and
the regulation in place at the national level, which can lead to
regulatory barriers. There is therefore a need to complement
these funds with national funds and to ensure consistency
between the EC's vision of the future European energy system
and that of national regulators and governments.
TSOs and DSOs can take a series of measures to make
use of these funds. TSOs and DSOs can:
✔✔ identify projects with European added value and prioritize the topics that support the integration of various technologies into electricity grids
✔✔ ensure finance matching with EC funding where
100% project costs are not covered
✔✔ position R&D activities as strategic objectives in the
activities of the network operators and make the projects
accountable through the use of monitoring systems and
january/february 2015



Table of Contents for the Digital Edition of IEEE Power & Energy Magazine - January/February 2015

IEEE Power & Energy Magazine - January/February 2015 - Cover1
IEEE Power & Energy Magazine - January/February 2015 - Cover2
IEEE Power & Energy Magazine - January/February 2015 - 1
IEEE Power & Energy Magazine - January/February 2015 - 2
IEEE Power & Energy Magazine - January/February 2015 - 3
IEEE Power & Energy Magazine - January/February 2015 - 4
IEEE Power & Energy Magazine - January/February 2015 - 5
IEEE Power & Energy Magazine - January/February 2015 - 6
IEEE Power & Energy Magazine - January/February 2015 - 7
IEEE Power & Energy Magazine - January/February 2015 - 8
IEEE Power & Energy Magazine - January/February 2015 - 9
IEEE Power & Energy Magazine - January/February 2015 - 10
IEEE Power & Energy Magazine - January/February 2015 - 11
IEEE Power & Energy Magazine - January/February 2015 - 12
IEEE Power & Energy Magazine - January/February 2015 - 13
IEEE Power & Energy Magazine - January/February 2015 - 14
IEEE Power & Energy Magazine - January/February 2015 - 15
IEEE Power & Energy Magazine - January/February 2015 - 16
IEEE Power & Energy Magazine - January/February 2015 - 17
IEEE Power & Energy Magazine - January/February 2015 - 18
IEEE Power & Energy Magazine - January/February 2015 - 19
IEEE Power & Energy Magazine - January/February 2015 - 20
IEEE Power & Energy Magazine - January/February 2015 - 21
IEEE Power & Energy Magazine - January/February 2015 - 22
IEEE Power & Energy Magazine - January/February 2015 - 23
IEEE Power & Energy Magazine - January/February 2015 - 24
IEEE Power & Energy Magazine - January/February 2015 - 25
IEEE Power & Energy Magazine - January/February 2015 - 26
IEEE Power & Energy Magazine - January/February 2015 - 27
IEEE Power & Energy Magazine - January/February 2015 - 28
IEEE Power & Energy Magazine - January/February 2015 - 29
IEEE Power & Energy Magazine - January/February 2015 - 30
IEEE Power & Energy Magazine - January/February 2015 - 31
IEEE Power & Energy Magazine - January/February 2015 - 32
IEEE Power & Energy Magazine - January/February 2015 - 33
IEEE Power & Energy Magazine - January/February 2015 - 34
IEEE Power & Energy Magazine - January/February 2015 - 35
IEEE Power & Energy Magazine - January/February 2015 - 36
IEEE Power & Energy Magazine - January/February 2015 - 37
IEEE Power & Energy Magazine - January/February 2015 - 38
IEEE Power & Energy Magazine - January/February 2015 - 39
IEEE Power & Energy Magazine - January/February 2015 - 40
IEEE Power & Energy Magazine - January/February 2015 - 41
IEEE Power & Energy Magazine - January/February 2015 - 42
IEEE Power & Energy Magazine - January/February 2015 - 43
IEEE Power & Energy Magazine - January/February 2015 - 44
IEEE Power & Energy Magazine - January/February 2015 - 45
IEEE Power & Energy Magazine - January/February 2015 - 46
IEEE Power & Energy Magazine - January/February 2015 - 47
IEEE Power & Energy Magazine - January/February 2015 - 48
IEEE Power & Energy Magazine - January/February 2015 - 49
IEEE Power & Energy Magazine - January/February 2015 - 50
IEEE Power & Energy Magazine - January/February 2015 - 51
IEEE Power & Energy Magazine - January/February 2015 - 52
IEEE Power & Energy Magazine - January/February 2015 - 53
IEEE Power & Energy Magazine - January/February 2015 - 54
IEEE Power & Energy Magazine - January/February 2015 - 55
IEEE Power & Energy Magazine - January/February 2015 - 56
IEEE Power & Energy Magazine - January/February 2015 - 57
IEEE Power & Energy Magazine - January/February 2015 - 58
IEEE Power & Energy Magazine - January/February 2015 - 59
IEEE Power & Energy Magazine - January/February 2015 - 60
IEEE Power & Energy Magazine - January/February 2015 - 61
IEEE Power & Energy Magazine - January/February 2015 - 62
IEEE Power & Energy Magazine - January/February 2015 - 63
IEEE Power & Energy Magazine - January/February 2015 - 64
IEEE Power & Energy Magazine - January/February 2015 - 65
IEEE Power & Energy Magazine - January/February 2015 - 66
IEEE Power & Energy Magazine - January/February 2015 - 67
IEEE Power & Energy Magazine - January/February 2015 - 68
IEEE Power & Energy Magazine - January/February 2015 - 69
IEEE Power & Energy Magazine - January/February 2015 - 70
IEEE Power & Energy Magazine - January/February 2015 - 71
IEEE Power & Energy Magazine - January/February 2015 - 72
IEEE Power & Energy Magazine - January/February 2015 - 73
IEEE Power & Energy Magazine - January/February 2015 - 74
IEEE Power & Energy Magazine - January/February 2015 - 75
IEEE Power & Energy Magazine - January/February 2015 - 76
IEEE Power & Energy Magazine - January/February 2015 - 77
IEEE Power & Energy Magazine - January/February 2015 - 78
IEEE Power & Energy Magazine - January/February 2015 - 79
IEEE Power & Energy Magazine - January/February 2015 - 80
IEEE Power & Energy Magazine - January/February 2015 - 81
IEEE Power & Energy Magazine - January/February 2015 - 82
IEEE Power & Energy Magazine - January/February 2015 - 83
IEEE Power & Energy Magazine - January/February 2015 - 84
IEEE Power & Energy Magazine - January/February 2015 - 85
IEEE Power & Energy Magazine - January/February 2015 - 86
IEEE Power & Energy Magazine - January/February 2015 - 87
IEEE Power & Energy Magazine - January/February 2015 - 88
IEEE Power & Energy Magazine - January/February 2015 - 89
IEEE Power & Energy Magazine - January/February 2015 - 90
IEEE Power & Energy Magazine - January/February 2015 - 91
IEEE Power & Energy Magazine - January/February 2015 - 92
IEEE Power & Energy Magazine - January/February 2015 - 93
IEEE Power & Energy Magazine - January/February 2015 - 94
IEEE Power & Energy Magazine - January/February 2015 - 95
IEEE Power & Energy Magazine - January/February 2015 - 96
IEEE Power & Energy Magazine - January/February 2015 - 97
IEEE Power & Energy Magazine - January/February 2015 - 98
IEEE Power & Energy Magazine - January/February 2015 - 99
IEEE Power & Energy Magazine - January/February 2015 - 100
IEEE Power & Energy Magazine - January/February 2015 - 101
IEEE Power & Energy Magazine - January/February 2015 - 102
IEEE Power & Energy Magazine - January/February 2015 - 103
IEEE Power & Energy Magazine - January/February 2015 - 104
IEEE Power & Energy Magazine - January/February 2015 - 105
IEEE Power & Energy Magazine - January/February 2015 - 106
IEEE Power & Energy Magazine - January/February 2015 - 107
IEEE Power & Energy Magazine - January/February 2015 - 108
IEEE Power & Energy Magazine - January/February 2015 - 109
IEEE Power & Energy Magazine - January/February 2015 - 110
IEEE Power & Energy Magazine - January/February 2015 - 111
IEEE Power & Energy Magazine - January/February 2015 - 112
IEEE Power & Energy Magazine - January/February 2015 - Cover3
IEEE Power & Energy Magazine - January/February 2015 - Cover4
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091020
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070820
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050620
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030420
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010220
https://www.nxtbook.com/nxtbooks/pes/powerenergy_111219
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091019
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070819
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050619
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030419
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010219
https://www.nxtbook.com/nxtbooks/pes/powerenergy_111218
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091018
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070818
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050618
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030418
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010218
https://www.nxtbook.com/nxtbooks/pes/powerenergy_111217
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091017
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070817
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050617
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030417
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010217
https://www.nxtbook.com/nxtbooks/pes/powerenergy_111216
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091016
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070816
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050616
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030416
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010216
https://www.nxtbook.com/nxtbooks/ieee/powerenergy_010216
https://www.nxtbook.com/nxtbooks/pes/powerenergy_111215
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091015
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070815
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050615
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030415
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010215
https://www.nxtbook.com/nxtbooks/pes/powerenergy_111214
https://www.nxtbook.com/nxtbooks/pes/powerenergy_091014
https://www.nxtbook.com/nxtbooks/pes/powerenergy_070814
https://www.nxtbook.com/nxtbooks/pes/powerenergy_050614
https://www.nxtbook.com/nxtbooks/pes/powerenergy_030414
https://www.nxtbook.com/nxtbooks/pes/powerenergy_010214
https://www.nxtbookmedia.com