Axel GAUTIER, Full Professor
Academic Director of Research
Member of the School Research Commission
President of the Doctoral College
Industrial Economics - Regulated Industries
The research projects of the Chair aim to
provide serious reflection on the impact of technological and institutional change on the role and regulation of distribution networks
set forth and compare the different practices implemented in Europe.
Ever since the complete liberalization of the energy market, the production of electricity, its transmission on the high-voltage network, its distribution on the low-voltage network and its commercialization have been organized autonomously. The production and commercialization activities are open to competition, whereas the organization of activities in ‘network’, distribution and transmission, continues to be monopolized and regulated.
The distribution regulation consists of calculating the cost of the activity for the DNOs (distribution network operators) and passing this cost on to customers via the distribution tariff. Effective regulation must entail an incentive both for the DNOs and the customers. For the DNOs, this implies a double incentive to control costs and invest in improving the infrastructure. For consumers, whose options for energy production and consumption are multiplying, this implies making economically effective decisions.
These technical and institutional developments make it necessary to reconsider the regulation of distribution activity:
as regards the technical aspect, the traditional vertical model (production-transport/distribution-consumption) has become obsolete and we observe new possibilities in terms of energy production (auto-production, decentralized production), consumption (demand management, auto-consumption) and distribution (micro-networks with or without network disconnection);
as regards the institutional aspect, we observe on the one hand a movement of consolidation of the Walloon DNOs and, on the other hand, a transfer of competence to the Regional authorities.