The challenge of IT-enabled policy design for sustainable electric energy systems

Abstract

This paper concerns complex interactions between the regulators, system operators/owners and the candidate investors in new technologies. It is proposed that an effective interactive framework should be put in place for decision-making that enables choice and it also meets the social objectives. Given the complexity of the electric energy systems this process can no longer be based on blue print rules supported by coarse scenario analysis. It requires, instead, Information Technology (IT)-enabled dynamic and interactive modeling and decision making by all industry stakeholders. In addition, the process requires a design of regulatory rights, rules and responsibilities (3Rs) for binding interactions that must be communicated between different industry participants. Moreover, it is suggested that the coarse National Energy Modeling System (NEMS) can no longer support the design of 3Rs. Instead, an Energy Temporal and Spatial Kit (ENTASK) is proposed to interactively link with the NEMS model that is well understood by the policy makers at present. An ENTASK-like tool is essential for facilitating public policy decision makers in assessing potential of diverse technologies while designing the 3Rs for the industry. The 3Rs must be binding as they have major financial, technical and economic implications. It is described how such an interactive IT-enabled decision making framework could support near-optimal investments in infrastructures needed to meet the social objectives. Perhaps most striking is the observation that such a framework facilitates novel ways of integrating while enabling choice.