the (future) role of the european dsos - what can we expect? · distribution systems in germany…...

Energi Norge Workshop – The role of the DSOs

The (future) role of the European DSOs - What can we expect?A German perspective

Dr. Jens Büchner

Oslo, 6th June 2018

2

E-Bridge – Competence in Energy

Your partner from strategy to implementation

DSOs

▪ Corporate Strategy

▪ Network operation and Digitization

▪ Asset Management and Investments

▪ Project and Program Management

▪ Interim Management

TSOs


▪ Asset Management

▪ Market Operation

▪ System Operation

▪ Processes / IT

Generation and Supply


▪ Concepts

▪ Business models

Markets

▪ Market Design

▪ Concepts

▪ Pricing and Incentive Systems

▪ Auctions

▪ Business Cases

Regulation

Project Management

▪ Head of International Multi-Client Projects

▪ Stakeholder Management (NRAs, ACER, EC)

▪ Conflict Mediation and Resolution

▪ Cost and Budget Management

▪ Risk Management

▪ Operational and strategic

Regulation Management

▪ Incentive Regulation

▪ Network Tariffs, Levies and Charges

▪ Concessions

The new and expanded roles of DSOs3

Coordinated use of flexibilities for DSOs and TSOs2

DSOs in Germany and current industry trends1

Agenda

3

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 assigned to the distribution system in Germany.

▪ More than 49 million customers (46 million residential and 3 million

industrial and commercial customers) are connected to these distribution

systems.

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

per year.

4

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

Length of power lines per DSO

Household customers

(3.500kWh/year)

below 5 ct/kWh

5 to < 6 ct/kWh

6 to < 7 ct/kWh

7 to < 8 ct/kWh

8 to < 9 ct/kWh

9 to < 10 ct/kWh

More than 10 ct/kWh

▪ A share of 96 % of RES 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.

… were successful in integrating more than 100 GW of installed capacities in

renewable energy sources (RES) until 2017.

5

45 41 8 ∑ 104 GW

4%

1%

20%

7%

42%

1%

25%

LV

MV

HV

MV/LV

HV/MV

EHV/HVEHV

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

0 0,1 0,2 0,2 0,2 0,2 0,3 0,3 0,4 0,4 0,4 0,5 0,5 0,5 0,5 0,6 0,6 0,60,5 0,91,3

1,8 2 2,3 2,6 2,7 2,83,2 3,3 3,4

3,84,4 4,7 4,8

5,96,4

7

0

0,20,8

1,3

2,12,2 2,4

2,7

2,9

3

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

5 % of the DSO have installed generation capacities larger than peak demand

Example: E.DIS

6

Inst

alled

Cap

aci

tyat

E.D

IS n

etw

ork

[GW

]

Peak Load: 2,3 GW

7

2 13 6 7 1454

239207

412

822

613

749

1134

0 0 0 0 0 0 0 12

120

58 62

178

474

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

HV MV

Nu

mb

er

of

con

gest

ion

man

ag

em

en

t

measu

res

of

E.D

ISThe fast growth of the installed RES capacity required the introduction of

EinsMan: an emergency measure to resolve network congestions

▪ EinsMan is considered a “measure of last resort”,

as RES have a priority access right

▪ More than 3,7 TWh of RES curtailed in 2016.

366

54

312

172

140

104

36

458

183

275

92

183138

45

162

16466

98 66

32

1990 2015 2030 2050

power

heat

mobility

CO

2-E

mis

sio

ns

in t

he p

ow

er,

heat,

mo

bilit

y s

ect

ors

in G

erm

an

y [

millio

n t

]

-15 %

-40 %

-60 %

-40 %

-62 %

-90 %

-80 %

-90 %

∑ 986

∑ 751

∑ 421

∑ 113

Current trends - ambitious political decarbonization targets combined with

major social and technological trends - will further accelerate the changes

8

Digitalization

Demographic

change

Individualization

New pattern

of mobilityChanges in the way

of working Decarbonization

Urbanization

Electrification

Battery Systems Local generation

(esp. Solar)

Communalization

and autarky+

A further increase of PV and wind power coincides with an increasing number

of flexible consumption

9

Source: E-Bridge Study Data Base

Forecast year2015

2055

2025

2065

2035

2045

2005

300

100

250

50

200

150

0

350

2015

2055

2025

2065

2035

2045

2005

100

250

50

200

150

0

Forecast year

2015

2055

2025

2065

2035

2045

25

5

20

0

15

10

Transport Sector:

Number of e-cars in

Germany (million)

PV Systems:

Performance in the

region Germany [GW]

2005

2015

2055

2025

2065

2035

2045

2005

Forecast year

8

18

14

12

0

16

10

6

4

2

Power-to-Heat

Power2Heat: Number

of heat pumps in

Germany (million)

Wind Power Plants:

Output in the region

Germany [GW]

Forecast year




Agenda

10

11

Flexibility

Congestion

management

Voltage control

Restoration

of supply

Congestion management

Voltage control

Trade

Balance management

Restoration of supply

Load-

Frequency-

Control

System

Market

▪ Large-scale generators replaced by small-scale distributed generation.

▪ Decentralized generation in the DSO networks – together with distributed load and storage facilities – are the source as flexibilities to the entire system.

▪ These facilities are needed for different purposes by different parties.

▪ Access to these flexibilities need to be coordinated to ensure a safe and secure operation of the network and the system.

▪ A technically reliable and economically efficient access to the flexibilities must be guaranteed by any new coordination mechanism.

Distribution

Network

Transmission

Network

The flexibilities in the DSO network are utilized by different parties – an

intelligent coordination mechanism is required

Congestion management becomes a continuous task of DSOs

12

▪ The conventional network expansion planning process, aiming at covering the simultaneous peak demand, results in

investments that cannot be implemented on time, that lead to high costs and that are socially not accepted.

▪ By using flexible consumption, generation or storage facilities, investments can approximately cut to half, total costs can be

reduced and acceptance can be increased.

Costs of flex utilization

Investment costs network

expansion

Complete grid expansion ("copper plate") Network expansion and use of Network expansion and use of

ø -25 %

Co

sts

an

nu

ity

100 % ø -20 %

1 E-Bridge (2017): Sichere und effiziente Koordinierung von Flexibilitäten im Verteilnetz (BDEW PG DSO 2.0)2 BMWi (2014): Moderne Verteilernetze für Deutschland

Network expansion and use of

network-compatible flexibilities (load)1

Network expansion and use of

network-compatible flexibilities (infeed)2

“Pre-schedule” phase “Schedule-based” phase “Real-time” phase

Today, the German DSO has no tools available for the cost-efficient management of

congestions

TSO

DSO

▪ Redispatch, including “network reserve”2

▪ Switching in own network2


▪ Curtailment of loads (AbLaV)2

▪ “Einspeisemanagement” 3

▪ Protection


▪ “Einspeisemanagement” 3

▪ Protection

▪ Limiting transmission capacities for

interconnectors1

▪ Switching measures in own network2

▪ Switching in own network2 ▪ Switching in own network2

13

Inst

rum

en

ts a

cco

rdin

g

to t

od

ay's

reg

ula

tory

fram

ew

ork

Fu

ture

req

uir

ed

inst

rum

en

ts

Smart Protection

Market-based congestion management (e.g., flexibility market)

Modern network tariff structure

1

2

3

1 D-2 Congestion forecast2 §13 (1) , EnWG3 §13 (2) , EnWG

Congestion management 2.0

Status quo

▪ Metering:

▪ Congestion forecast:

▪ Active congestion management measurement:

➢Overload persists until protection is released

➢Consequences:

1. Disconnection of network customers, usually beyond of what is

required

2. Load curtailment without any economic considerations

3. Unsatisfied customers and damage of the DSOs image

4. Faster aging of equipment without any economic evaluation

5. Long process of re-connection: Technicians need to be on-site

“Smart protection" prevents critical overloads and thus enhances the capacity of

distribution grids

14

Overload of network elements

Smart protection

▪ Objective: Selective automated load and generation

curtailment process in the “real-time” phase. This may

limit the economic and social damage of a

disconnection.

▪ Procedure: Metering of demand and voltages. In case of

an overload, flexible demand will be curtailed step-wise.

▪ Minimal impact for the customers. Customers may not

even realize the overload situation at all.

Flexibility

ICT

The "market-based congestion management" is required to make maximum use of

decentralized flexibilities during the planning phase

15

▪ Many small and medium-sized generating

plants, consumers and storage

▪ Amended schedule-based process to provide

the basis for local delivery

▪ Coordination with neighboring network

operators and market participants

▪ Market-based remuneration, provided that

sufficient competition is ensured

▪ “Balancing responsibility” by network

operators or flexibility providers

▪ „Few” large conventional generation units

▪ Schedule-based process with individual

power plants (> 10 MW) for a

small number of known congestions

▪ Limited coordination with other network

operators

▪ Regulated remuneration

▪ “Balancing responsibility” by TSOs

Market-based congestion management

in the distribution networkToday's redispatch process

1. Larger number of flexibility providers

3. Higher coordination effort

Coordination via flexibility markets with a

high degree of automation

2. Flexibility predominantly in the distribution

network

At present, flexibility markets are being developed in various initiatives. The main

parameters are similar.

▪ All flexibility markets have the same focus, same main product definition and trading period.

16

Flex-Router(BDEW PG DSO 2.0)

ENKO(SINTEG NEW 4.0)

ENERA(SINTEG ENERA)

Nodes(Agder Energi / Nordpool)

WindNODE(SINTEG WindNODE)

Focus Congestion management

Product definition Deviation from “schedule” (Ø power per 15 minutes)

Trading period Intra-day time frame

… …

Geographic resolution Connection point Congestion area Congestion areaConnection point/

Congestion areaPlant

Market pricing pay as bid pay as cleared pay as cleared pay as bid pay as bid

Considered network levels (EHV), HV, MV HV, MV, LV EHV, HV, MV (EHV), HV, MV, NV EHV, HV

… … … … … …

Man

y s

imil

ari

ties

Dif

fere

nces

in t

erm

s o

f

desi

gn

deta

ils




Agenda

17

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

and automatization in distribution networks – but there is still a long way to go

▪ The new role “DSO 2.0” requires a 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 meter roll-out in Germany is planned to be completed in 2032 and has not yet begun.

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

there is the risk that the necessary actions may be postponed and continuation of the “Energiewende” may be endangered.

18

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 markets“)

New business models at the interface between market and

network

▪ New and expanded tasks of DSO lead to a new role

Current situation of distribution systems in Germany in a nutshell.

19

The DSOs in Germany, showing a great variety in size, RES penetration, network tariffs and know-how, successfully

integrated more than 100 GW of RES (peak load in Germany: 80 GW) into the energy system.

The „second wave“ of the energy transition - with further RES expansion and an electrification of the heating and mobility

sectors - will lead to increased challenges for DSO with a further growth of the investments needs.

DSOs will have to play a more complex and active role in the operation of the electricity networks and the system. They

must make maximum use of automatization and digitalization in order to fulfill the increased coordination requirements.

Network planning rules have already been modified with the introduction of “EinsMan”. Further amendments of the

planning and operation rules will be required: i.e. “Smart Protection” and “Market-based Congestion Management”.

Disclaimer 20

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