Texas-Germany Bilateral Dialogue on Challenges an Opportunitiers in the Electricity Market

Distribution systems in Germany – smart investments, digital

operation and an evolving role in the energy system

Austin, Texas, 27.02.2018

Distribution systems in Germany…

888 DSOs in Germany operate more than 1.150.000 km on low voltage level

(0,4 kV) and 510.000 km on medium voltage level (10-20 kV).

Networks on high voltage level (110 kV) with an overall length of 95.000 km

are also counted as distribution systems in Germany.

More than 49 Mio. customers (46 Mio. residential customers and 3 Mio.

industry and commerce) are connected to these distribution systems.

The sum of network tariffs in distribution networks is more than 25 bn. EUR

per year and is very unequally distributed among the DSOs in Germany.

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system 2

netw

ork

tari

ffs

(ho

use

ho

ld)

in G

erm

an

y 2

016

178

586

106

18

< 100 km 100 km - 1.000 km 1.000 km - 10.000 km > 10.000 km

Nu

mb

er

of

DSO

s in

Germ

an

y

Lenght of power lines per DSO

A share of 96 % of RE systems in Germany (∑ 100 GW) are connected

in distribution systems - 42 % on medium voltage level (42 GW).

RE systems are unequally distributed in Germany and among the

DSOs: only for 5 % of all DSOs, the installed generation capacity

exceeds the peak load – a large share of DSOs has no RE systems

connected to their network.

Due to congestion on TSO and DSO level, more than 3,7 TWh of RES

infeed was curtailed in 2016.

… were successful in integrating more than 100 GW of RE systems until 2017.

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system 3

45 41 8 ∑ 104 GW

4%

1%

20%

7%

42%

1%

25%

LV

MV

HV

MV/LV

HV/MV

EHV/HV EHV

Vo

ltag

e level o

f R

ES c

on

nect

ion

Ao

llo

cati

on

of

sola

r p

ow

er

in G

erm

an

y

Ao

llo

cati

on

of

win

d p

ow

er

in G

erm

an

y

366

54

312

172

140

104

36

458

183

275

92

183 138

45

162

164 66

98 66

32

1990 2015 2030 2050

power

heat

mobility

CO

2-E

mis

sio

ns

in p

ow

er,

heat,

mo

bilit

y s

ect

or

in G

erm

an

y*

[Mio

. t]

-15 %

-40 %

-60 %

-40 %

-62 %

-90 %

-80 %

-90 %

∑ 986

∑ 751

∑ 421

∑ 113

Ambitious political targets concerning decarbonization in combination with

major social and technological trends will further change the energy landscape.

4

Digitalization

Demographic

change

Individualization

New pattern

of mobility

Changes in working

environment

Decarbonization

Urbanization

Electrification

Battery Systems

Local generation

(esp. Solar)

Communalization

and autarky

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system

+ +

tech

nolo

gic

al

tren

ds

soci

al tr

en

ds

Scenario 2050 for Germany

• 320 GW RES capacity

• 100 % E-Mobility (40 Mio.)

• 8 Mio. electric heat pumps

• Load: 750 TWh / 150 GW

The further development of the energy landscape will lead to high investment

needs in distribution systems in Germany.

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system 5

-

10

20

30

40

50

60

128 GW RES 139 GW RES 209 GW RES

LV MV HV HV (additional costs for cable)

E-Bridge simulated the investment needs caused by

RES integration on behalf of the Federal Ministry

for Economic Affairs and Energy (BMWi) in 2014.

Depending on the scenario, investments up to 50

bn. EUR until 2032 are necessary in German

distribution systems („business as usual“).

Another result of the study was the adaption of the

legal framework by allowing an innovative network

planning procedure for DSOs.

To avoid investments for RES peaks which occur

only a few times a years, DSOs are allowed to take

into account a curtailment of 3 % of the infeed of

RES (energy) which equals up to 40 % of peak load.

(“Spitzenkappung”).

Hurdle: The regulatory framework does not reward

the overall cost reduction but gives an incentive for

investments, so that this innovative planning

procedure is used “hesitantly”.

Invest

men

ts in

Dis

trib

uti

on

Netw

ork

s in

Germ

an

y

du

e t

o R

ES in

teg

rati

on

[b

n.]*

*results of study „Moderne Verteilnetze für Deutschland“ in behalf of BMWi, 2014

The Role of a DSO and the corresponding tasks will change significantly.

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system 6

For a long time, the electrical energy supply system was characterized by power generation in central power plants

connected to the transmission grid.

The described developments fundamentally change this structure, because all essential transformation processes take place

in the distribution network.

By 2050, more than 60 million new, actively controllable and largely intelligent systems will be connected to the distribution

network and shape a the new energy landscape.

Thus the complexity of current tasks of DSOs will increase and new tasks will be part the new role „DSO 2.0“:

Congestion management with decentralized flexibility of solar power, batteries, electric heat

pumps, E-mobility etc.

Black-start and island operation of distribution systems

Coordination of alternative flexibility use cases (e.g. TSO)

(„flexibility market“)

Business models at the interface between market and network

Pre-condition for a successful energy transition is a high degree of digitalization

and automatization in distribution networks – but this is not the case today.

The new role “DSO 2.0” can only be successfully fulfilled with high degree of automatization and digitalization, e.g. a wide-

ranging state estimation of the network, especially on low voltage level - this is far away from todays reality.

The smart rollout in Germany, the desired digital platform, is planned to be finished in 2032 and has not yet begun.

Another major effect of digitalization: The business (revenue) of network operation will decrease since only a share of todays

staff is required and investments will be obsolete by actively control generation, demand and thus load flow.

The regulatory framework in Germany does not reward efficiency and digitalization. If no other drivers push digitalization,

the speed of increase of efficiency is not and will not be „breathtaking“ in the near future.

7

Network Operation today Network Operation 4.0

Automatization of processes and

interfaces with third parties

State Estimation of networks

Consistent network data set

and system integration

…

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system

Current situation of distribution systems in Germany in a nutshell.

8

The DSOs in Germany, which show a great variety in size, network tariffs, know how and area of supply, did a fantastic job in

last years by successfully connecting more than 100 GW RES (peak load in Germany: 80 GW).

The „second wave“ of energy transition in Germany with further RES expansion, an electrification of heating and mobility and

new ways of producing, storing and consuming energy will lead to further investments in distribution systems.

We see a bright future for DSOs by increasing quality and cutting costs at the same time making use of automatization and

digitalization. A “DSO 2.0” can fulfill a more complex, active and responsible role in the energy system.

The transformation in a digital „network operation 4.0“ is a long way to go – perhaps Germany can learn from digital

experience in network operation in Texas?

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system

9

Dr. Henning Schuster

E-Bridge Consulting GmbH

Baumschulallee 15

53115 Bonn

tel: +49 228 90 90 65 16

mob: +49 172 271 10 02

email: hschuster@e-bridge.com

www.e-bridge.com

Distribution systems in Germany – smart investments, digital operation and an evolving role in the energy system

Disclaimer 10

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