How DSOs are transforming their networks in Europe
Seven DSOs projects in Europe highlight how these operators are innovating to meet energy system challenges in a new paper from the electricity and gas DSO association GEODE.
The paper, Distribution Grids: The Energy Transition’s Backbone, points to the role of the DSOs as “the crucial actor” in the energy system and “enablers of the changes” and that they are ready to play a more active role in the operation of their grids.
For example, as neutral market facilitators, the DSOs are the ideal partner for energy communities, who can benefit from their expertise in grid management while providing flexibility to the grids.
The DSOs also are best placed to enable decarbonisation by facilitating the integration of hydrogen and biomethane.
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Thus, it is essential to establish a proactive adequate regulatory framework acknowledging the role of DSOs and supporting and anticipating the necessary investments for upgrading and expanding the existing distribution grids, procurement of flexibility services and for strengthening its digital and data capabilities, states GEODE.
Grid controllability and observability is crucial. Measures for faster and simplified permitting procedures for new grid infrastructure also are needed.
In the paper, GEODE adds that DSOs require a toolbox of solutions to operate a future electricity grid fit for purpose.
To further promote flexibility, they must be able to have control options among their responsibilities, including the use and operation of system-serving storage.
Electricity networks
Europe’s targets and measures towards decarbonisation have led to the transformative trends in the electricity sector of decentralisation, democratisation and digitalisation, while other key areas for focus are the gas networks and wider network and investment planning.
Decentralisation
The penetration of solar PV, electric vehicles (EVs), heat pumps and batteries is having a strong impact on distribution networks. While promising for decarbonisation, this trend poses complex challenges for the management of the grids.
One of the tools to integrate DERs is flexibility with a wide range of technologies available to deliver it.
Norwegian DSO Å Energi implemented the Norflex project to demonstrate a local energy marketplace (NODES) in distribution grids, with the main objective to incentivise and facilitate the use of flexible DERs through a market-based approach.
The main goal was to establish an independent market platform and common language for the DSOs to develop tools and methods to use market-based solutions for congestion management purposes, to provide the TSO with new aggregated resources for balancing the power system and to help aggregators to develop their individual business models.
During the project period, the NODES platform has provided 31,470 trades with a total volume of 1.39GWh from over 4,400 assets.
Democratisation
The more active participation of consumers in the energy system individually or in energy communities is another trend. An example is the COMPTEM collaboration between the Spanish energy cooperative Enercoop and the municipality of Crevillent (Alicante) to develop a village-wide energy community.
ENERCOOP promotes collective self-consumption facilities in public and private buildings, small PV plants in the peri-urban area of the village and EV charging stations. A mobile app is available to members to maximise their electricity self-consumption. Digital panels in public buildings with the municipality’s energy information also are being implemented to support the education and engagement of citizens.
At the beginning of 2023, COMPTEM had 600kW of PV installed on public roofs, 242kWh of energy storage, four EV charging stations and two information panels within the municipality. The objective is to substantially increase the capacity of renewable generation and storage in the community in the next years.
Digitalisation
Digitalisation is considered the necessary tool to optimise system operation while improving the experience of customers, with promising developments in this area including the design at EU level of smart grid Indicators and the development by DSOs of digital twins for use to simulate and test the impact of DER integration.
Austrian DSO Linz Netz has launched a digital twin pilot to gain experience using existing measurement data from transformers, inverters and customers in the grid planning process, which is expected to give more detailed insights and result in more economical use of existing grid infrastructure than traditional grid planning exercises that rely on worst case assumptions and can lead to costly grid expansion.
Gas networks
Decarbonisation policies and recent geopolitical developments are redefining the role of gas in the European energy system. Nevertheless, gaseous energy will continue to play a relevant role in the EU’s mix for the foreseeable future, both in the form of alternative natural gas imports and through the penetration of new solutions such as renewable hydrogen and biomethane.
Thus the role of the gas DSOs will remain crucial in contributing to the decarbonisation of the EU gas system.
Danish gas DSO Evida is responsible for the injection of biomethane into the distribution grid and has so far connected 56 biomethane production plants reaching a share of about 34% biomethane by the end of 2022. The level of 100% biomethane in the grid is expected to be reached around 2030.
Biomethane cannot flow freely across the full distribution grid which results in imbalances when the local production is greater than the local consumption and the need for grid reinforcements. Evida’s strategic planning approach to reinforcement along with ‘local’ ownership are attributed to the speed and expansion of biomethane in the Danish grid.
In Austria, the purpose of the construction of the H2 Collector East hydrogen pipeline from Burgenland to Vienna by the DSOs Wiener Netze, Netz NÖ and Netz Burgeland and the TSO Gas Connect Austria is to alleviate the strain on the electricity grid infrastructure caused by the increase of volatile PV and wind generation and to lay the groundwork for the future of hydrogen in Austria.
The objective is to produce renewable hydrogen through the expansion of renewable energy in order to supply industry, which has an urgent need for renewable hydrogen.
Investment and network planning
To support all the transformative trends, GEODE’s view is that network investment and planning are priorities to make grids more resilient and fit for a new energy system.
Thus it is important to support a comprehensive approach towards the investments, with requirements including regulatory certainty, easier and faster permitting procedures, support for capacity-based network tariffs and a more balanced approach between opex and capex in DSOs’ remuneration.
Since 2014, in Finland the DSOs have been obligated to form their network development plans and since 2021 to undertake a one-month public consultation.
Considering that its webpage would not create value for customers nor itself, Elenia innovated an interactive map-based platform for public consultation, ‘Elenia Avoin’ (Elenia open/transparent), covering the basics of how the grid works and enabling users to gain insights such as where the electricity comes from, outage histories and future plans for any location in the company’s network.
The project ‘Zukunftsstadtwerk Schwerte’ aims to identify a decarbonisation strategy for the energy system of the German DSO Stadtwerke Schwerte.
Together with the BBH group, Stadtwerke Schwerte wants to answer the key question – what is its future role in 20 years, in 30 years? To answer and develop a roadmap, several steps were necessary, including analysing historical data and examining the current revenue situation in the respective electricity, gas and heating segments, identifying the potentials, devising a model of the future role as supplier, optimising the entire energy system and evaluating the regulatory framework conditions.
These key questions should be asked by every DSO and answered considering the individual parameters. “In the end, only a stable and proactive planning is beneficial to users”.
