As it is necessary to be quick, regulatory changes will often lag, what is identified as preferable pathways, but these changes could be accelerated through Regulatory Sandboxes, which are able to verify effects of new regulatory instruments before actual implementation.

All energy systems, whether vertically integrated or deregulated, have some sort of regulatory or market oversight. Some of these regulations have been long established and originate from stem out of initial structures created around the turn of the 20th century. However, as the electricity grid transitions towards a more decentralized structure, with deepened engagement of end-users (including consumers) and involvement of a wider variety of other stakeholders and service providers, there is a need to enable testing of new regulatory structures that can better support integration of advanced smart grid technologies and business models.

This casebook provides detailed information on planned or implemented Sandbox Programs for Australia, Austria, Germany, Italy and The Netherlands. An overview of the previously well documented program in the UK is provided as well.

Hawaii is included as an example of another form of regulatory experimentation. In this case, one US state is experimenting with a performance-based method for tariffs which, if successful, can be rolled out as a regulatory innovation to other US states or other countries. The main focus of the casebook however is laid on experimenting to achieve the above mentioned innovation goals by means of sandbox projects.

The purpose of this report is to give an account of a collaborative International Smart Grid Action Network (ISGAN) project on public support and funding to Smart Grid Research, Demonstration and Innovation (RD&I), with focus on the use of Key Performance Indicators(KPIs).