This paper develops a bi-level optimization model for voluntary demand-side flexibility. The Distribution System Operator, in the Upper Level, maximizes welfare by investing in the network and setting the flexibility compensation. Consumers, in the Lower Level, can be prosumers and commercial...

There is a trend in regulatory practice towards exceptional incentives for exceptional investments. Italy and the US have the longest experience with a regulatory framework for strategically important investments that deviates from the default framework. In these countries, the incentives...