All energy systems, whether vertically integrated or deregulated, have some sort of regulatory or market oversight. Some of these regulations, particularly in the electricity sector, have been long established and originate from socio-technical structures created around the turn of the 20th century. However, as the electricity grid develops towards a more decentralized structure, with deepened engagement of end-users (including consumers) and involvement of a wider variety of other stakeholders and service providers, there is a need also to change the institutional setting and business model in conjunction with the new infrastructure requirements. One of the main challenges is how to transform the regulatory framework in co-evolution with technological change. To speed this up, regulatory experimenting seems to be a way forward leading to new regulatory structures and technological solutions, which can better support integration of advanced smart grid technologies.
The work on transformative innovation policy of the IEA-TCP ISGAN – International Smart Grid Action Network, in particular, the standing working group Annex 7, which deals with Institutional Change in Smart Grid Transitions, focusses on creating experimental space. The ISGAN activities on Regulatory Experimenting focus on supporting new solutions or their deployment in a clearly defined space of regulatory exemptions in the field of “smart” electricity grids and integrated energy systems.
In the last years, energy-related programs for regulatory experimental have been established or are currently implemented in several countries including as Australia, Austria (Energie.Frei.Raum), Germany (SINTEG), Italy, The Netherlands, Singapore (Sandbox program), South Korea, Sweden and UK (Sandbox program).
The results are based on material from our involvement in project conducted for the International Smart Grid Action Network (ISGAN), which is a Technology Collaboration Programme (TCP) of the International Energy Agency (IEA) and an initiative of the Clean Energy Ministerial. The project was led by an international team of ISGAN experts and involved about 45 experts and policy makers from more than 20 countries. It involved a preparatory survey and webinar, an interactive knowledge exchange workshop, held during the Stockholm Smart Grid week 2019, and a recently published casebook of regulatory experimenting examples from seven countries (ISGAN 2019).