Market design and regulation for demand side management and renewable electricity self-consumption in France: the discipline of competition
Résumé
The advocacy of demand side management and self-consumption of electricity from renewable sources has been driven by the promise of economic efficiency and competitiveness compared to other solutions relying on centralized generation and the grid. At the request of the French political authorities, the independent authority of regulation has attempted to define the technical and legal conditions for these activities so that they can compete. The article identifies the ambiguities and flaws of this ambition and looks at how the regulatory process addresses them. Firstly, this competition requires specific regulation that involves abstract reasoning to readjust the economic conventions of the centralized electricity market to reflect the economic benefits of decentralized solutions. Secondly, this reasoning can open to controversies, weakening the independent authority, involving the political authorities. This research questions the process of regulation when the definition of the frontier between political objectives and technical regulation is not stabilized.