Quantitative reliability considerations in the determination of performance-based rates and customer service disruption payments

Abstract

The application of reliability index probability distributions to establish an appropriate balance between reliability improvement and cost saving strategies is discribed. Contracts between an administrative board and power utilities in the form of performance-based rates and contracts between a utility and a customer in the form of customer service disruption payments can be analysed using the appropriate index probability distributions. The developed concepts are illustrated using a test distribution system.