In this thesis, a retail market mechanism that provides differentiated reliability services is proposed. The differentiated reliability services beyond the standard level utilize advanced metering infrastructure, automated distribution reconfiguration and distributed generation (DG). The service quality at the standard level is regulated, while high reliability services are offered through a market mechanism. This proposed market mechanism is designed in two different models of managing the distribution networks. The first model assumes that an independent distribution system operator (DSO) as an administrative firm provides operational support for delivery and reliability services in a retail market, while the second model does not have a DSO. Main reliability market participants are distribution utilities, retail electricity providers (REPs), non-utility-owned DG units, and end users. The REPs, as end users’ representatives and aggregators, purchase delivery service with high reliability level and backup power from the utilities and DG units, respectively. The prices for these services are based on bidding by all market participants. Bids are created by each market participant optimizing its objective with respect to its own interests; therefore, the market participant can assess the investment costs and manage its own risk in setting the service charge. Notably, the proposed market mechanism, which is based on knowing customers’ willingness to pay, and preferences for reliability, aims to give long-term investment signals to service providers for planning investments in new technologies at value. In addition, the provision of high reliability services can be considered a means that enables the service providers to improve system resilience. The modified IEEE Roy Billinton Test System Bus 2 is simulated to demonstrate proof-of-concept for the proposed retail market by showing the iii process of settling the service prices and utilities’ expected compensation design. By comparing the settled service prices between the two market models, we show that the service prices are quite similar, but the number of end users obtaining backup power is different.

We analyze the pass-through of cost changes to retail tariffs in the German electricity market over the 2007-2014 period. We find an average pass-through rate of around 60%. This significantly varies with demand factors: while the pass-through rate to baseline tariffs, where firms have greater market power because customers are less willing to switch, is only 50%, it increases to 70% in the competitive segment of the market. Although the pass- through rate of independent firms is significantly higher than that of other firms in the competitive market segment, the extent of supply-side heterogeneity is limited. Thus, the firms' ability to exercise market power and reduce pass-through appears to be constrained by competition and largely determined by demand side factors. Finally, we find that the pass-through rate in the competitive market segment has been approaching unity over the past years, indicating a rise in competitive pressure.

The fact that household customers are central in the discussion of future sustainable energy systems compels the Swedish electricity retail companies to provide strategies in order to successfully follow the trends on the electricity market. The purpose of this thesis is to complement the electricity retail companies’ understanding of how they are able to enter a sustainable and close business relationship with these customers. The purpose is fulfilled by the analysis of how relationship concepts impact the development of demand response specifically. The information has been collected through a case study of Smart Customer Gotland, via interviews with people who have great experience from the field and via a survey directed towards the customers. The results indicate that there is a major difference in both of the actors’ visions regarding the relationship. The company desires to enter a position where less support and high customization is available. Customers instead want more personal support because of their lack of knowledge and uncertainty of new systems. To succeed, the companies have to consider the fundamental influencing incentives, economy and comfort, while also maintaining the customers’ trust. The most essential parts of the context specific relationship exchange are product exchange, information exchange, and social exchange. These should be directed towards maintaining and increasing the trust from customers. Focusing the resources earlier used for marketing, on these exchanges to make the current customers more satisfied will open up for using word-of mouth primarily from early adopters. Continued work with these early adopters will also increase companies’ knowledge, which is important for the companies to strategically develop its business towards the market of smart energy solutions.

There has been a motivated desire from different power system operators to have more systems embedded in computing and networking due to the great advantages of adding new capabilities that wasn't before possible. These advantages increased the power system’s up-time, performance and reduced its maintenance but opened a world of possible cyber-attacks. In January 2016, the Ukrainian electricity infrastructure suffered the first power outage caused by destructive malware that left hundreds and thousands of end-users without electricity during the Christmas holidays. Malicious malware are starting to cover cyber-physical systems that connect the physical technical equipment with the networked computational resources. One of these resources, which are currently being further developed, involves futuristic procedures for the electrical billing process. This means that data corruption could lead to both economical and physical consequences, leading to a decrease of the public's trust on metering equipments, the overall smart grid concept and the electricity market actors. The Nordic and Swedish electricity market is under transition to the Supplier Centric Model (SCM), a new market model, which facilitates the billing and payment towards the end-users and the interactions between electrical suppliers and Distribution System Operators (DSO). This model uses a centralized data service hub for information exchange that is owned and operated by the Swedish Transmission System Operator (TSO). Vattenfall IT has thus jointly with the department of Electric Power and Energy systems (EPE) at KTH launched this master thesis that focuses on the risks and consequences caused by cyber-attacks in the SCM. An adversary may cause unwanted actions by business process hacking or knowledge-based hacking by analyzing the business processes maps within the SCM One of the aims of the thesis was to identify the business process vulnerabilities and events of the DSO's and supplier’s business processes in the SCM if the system was under attack and when the power system operator was unaware that the presented data was corrupted. The outcome of the thesis will help improve the business process resilience against cyber-attacks thus leading to an increased trust in the SCM from the general public. Different related attack-scenarios (AS) were investigated to provide a generic solution for improvements to all relevant business service actors. The risks and consequences were found, analyzed and used for developing suggestive improvements for the Billing Business Process (BBP). / Det har funnits ett motiverat önskemål från olika elkraftsoperatörer att flera system inbäddas i datoranvändningen och nätverken på grund av de många fördelar och nya förmågor som inte var möjliga förut. Dessa förmågor ökade elkraftsystemens tillgänglighet, prestanda och minskade dess underhåll men öppnade en värld av möjliga cyber-attacker. Den Ukrainska elektriska infrastrukturen upplevde det första strömavbrottet orsakad av destruktiva skadeprogram som lämnade tusentals användare strömlösa under julen 2015. Skadeprogrammen har börjat täcka cyber-fysiska system som kopplar det fysiska tekniska utrustningen med de nätverskopplade beräkningsresurserna. En av dessa resurser, som för närvarande är under utveckling, involverar framtida procedurer åt faktureringsprocessen för elektricitet. Detta betyder att data korruption kan leda till både ekonomiska och fysiska konsekvenser vilket leder till en förminskning av det allmänna förtroendet på mätningsutrustningen, det generella smarta elnätskonceptet och på elmarknadsaktörerna. Den nordiska och svenska elmarknaden är under övergång till Elleverantörs Centriska Modellen (SCM), en ny marknadsmodell som underlättar fakturering och betalningen gentemot användarna och växelverkan mellan elleverantörerna och elnätsföretagen (DSO). Denna modell använder en centraliserad tjänstehubb för informationsutbytet som ägs och drivs av den svenska systemansvariga myndigheten (TSO). Vattenfall IT har således tillsammans med avdelningen Energi och Elkraft (EPE) på KTH lanserat detta examensarbete som fokuserar på riskerna och konsekvenserna orsakade av cyber-attacker i SCM. Motståndaren kan orsaka oönskade handlingar via hackning av affärsprocesserna eller kunskapsbaserat hackning genom att analysera affärsprocesskartorna inom SCM. Ett mål av examensarbetet var att identifiera affärsprocessernas sårbarheter och händelser av en DSO och elleverantörs affärsprocesser i SCM om systemen var under anfall och elkraftsoperatören är ovetande att det presenterade data är korrumperat. Examensarbetets resultat kommer hjälpa att förbättra affärsprocessernas spänstighet mot cyber-attacker vilket kommer leda till ett ökat förtroende på SCM från allmänheten. Olika relaterade cyber-attack scenarion undersöktes för att förse en generisk lösning för förbättringar åt alla relevanta verksamhetsaktörer. Riskerna och konsekvenserna var funna, analyserade och användes för att utveckla förbättringsförslagen åt faktureringsprocessen (BBP).