Transmission system operators (TSOs) manage the high-voltage grid by investing in its infrastructure, balancing electricity demand and supply at all times, and facilitating cross-border electricity trades.

For a project with TenneT, the TSO in the Netherlands and for large parts of Germany, we explored how the regulation of TSOs could evolve in the future. The focus was on developing regulatory elements that provide better incentives and an overall balanced system.

Our initial study analysed how the roles of TSOs might develop going forward and proposed two regulatory prototypes. These included an equal treatment of all types of expenditure, as well as several output-based incentives. In a follow-up study, we developed several aspects of the regulatory prototypes in more detail.

The studies were discussed with the German regulator (Bundesnetzagentur), as well as at our discussion forum. Both studies have now been published by TenneT and are available here.