A risk-based model for performance-based regulation of electric distribution companies

In this study, a model is presented to obtain the parameters of penalty and reward scheme (PRS) in performance-based regulation (PBR) for each electricity distribution company (EDC) using analytical hierarchy process (AHP) and fuzzy c-means clustering (FCM). In the FCM algorithm, similar companies were categorized into clusters. By using AHP, score of effective factor in reliability index was obtained. In this model, external factors affecting EDCs performance were considered to reduce the risk of PBR implementation for companies and customers. The proposed model was applied on the EDCs in Iran. The results, including AHP score, parameters of PRS and PRS cost were calculated.