Speech of Christian Buchel, E.DSO chair, during the opening of the European Utility Week in Paris
Dear Chair Sasha Twining, dear Francesco La Camera,
Dear colleagues, partners, stakeholders of our industry,
ladies and gentlemen,
Innovate, disrupt, create, connect, inspire : this is what you – we – came here for. In less than a decade, the European Utility Week has become a must. Congrats Paddy ! From year to year the panels and the booths gather more and more technology and service providers from both energy sector and from the leading IT and communication industry. It demonstrates how fast our sector is changing. On DSO side, which I represent for years on a European scale, we combine already, on a daily basis, energy, IT and communication.
In the energy transition and the whole energy value chain, DSOs are probably from those who have to transform themselves most radically. We become clearly technology and communication platform operators, in the service of consumers, suppliers and generators and allow a fair open market.
The 2400 European DSOs directly employ more than 300 000 people. E.DSO members, leading this DSO industry in Europe, operate in 25 European countries, connect more than 350 million customers and, on generation side, nearly 300GW solar and wind power. To give you a flavour of the impressive connection challenge: according to our friends from SolarPowerEurope, more than 10GW net new addition in 2018 with 21% faster growth than the year before. And it will continue! Another figure to illustrate the historical momentum that we are currently experiencing: we, as DSOs, invest roughly 17 billion euros per year.
Nevertheless, leading means much more than dealing with impressive figures.
Leading means being digital, data-focused as we are on electrons.
Leading means investing massively not only in money but also in skills and innovation.
Leading means allowing disruptions and quick industrialization of the new ways to generate and consume electricity.
Leading means fostering electrification of the world, in an affordable, reliable and sustainable way.
Leading means enabling a fair energy transition.
Energy transition requires an adequate level playing field. E.DSO, our association, the trusted voice of DSOs in Europe, handles policy issues and bridges EU policy makers and industry players. All together, we contribute to build the essential regulatory framework citizens are looking for and act to achieve EU climate targets. The Clean Energy Package illustrates this well: we brought our commonly developed expertise with a lot of stakeholders in this room, to help the Member States, the Commission, the Parliament and the ACER to settle the ambitious objectives of this package.
Actually, this historical package goes further in cooperation as it gives us the mandate to establish an expert sister entity to ENTSO-E: the EU DSO entity. It is currently in creation and will, I hope, soon start factoring DSO expertise and providing the network codes and standards needed to accelerate industrilization. This Entity will also strengthen the confident cooperation developed between DSOs and TSOs. This allows us to be optimistic regarding the implementation of adequate and sophisticated digital platforms.
Unfortunately, by design, this EU DSO Entity is largely overregulated and the current discussions are not enough industrial driven and focused! We do everything possible so it will be an agile, cost effective, and entrepreneurial driven entity. For us, it is key, and somehow a condition to take part of it.
At the same time, the Clean Energy Package also presents DSOs with further responsibilities, some of which were part of our business already, while others are updated or entirely new. The role of DSOs as neutral market facilitators is strengthened. The importance of flexibility, and procurement of related services by DSOs, is strongly established in the new Electricity Market Design. The Clean Energy Package also gives a legal framework to new models of consumption putting the customers at the centre such as collective and individual self-consumption, active customers or Citizen Energy Communities. Members of E.DSO are already dealing very actively these new DSO responsibilities.
New challenges are also coming, as the President of the new European Commission, Ursula von der Leyen, wants Europe to become the world’s first climate-neutral continent. Our association has already proposed to the new energy Commissioner Kadri Simson’s to implement concretely the legislation and to take part in the European Green Deal.
Innovation will pave the way to carbon neutrality. To that end, EU funded projects allow industry to test innovating solutions.
Together with our industrial partners, the DSOs have already taken the lead in smart grid innovation through large-scale coordination projects. We welcome our common work in research and innovation, and we thank the Commission for the support we get through EU-funded projects. It is crucial to define, test and implement smart technologies and solutions. As of today, E.DSO has been involved in 11 EU-funded projects and our members participate in many more.
The CoordiNet project for instance, addresses two key issues for the energy system: TSO/DSO coordination, and customer empowerment. It demonstrates how DSOs and consumers can best coordinate to produce standardized flexibility grid services.
Moreover, to put consumers at the centre, INTENSYS4EU, aims at turning the European Commission’s Strategic Energy Technology Plan into reality through a streamlined and efficient European energy system. It successfully rolls-out digitalisation and sector coupling thanks to a clear vision and targeted innovation.
New concepts also emerge. In the mobility sector, Brainport Eindhoven’s demonstrator in the Netherlands, one of the five European use cases from the Interflex project, is already testing a smart traffic network, which allows autonomous vehicles to participate in normal traffic and traffic lights to give personalised advice to smoothen traffic flow.
All these projects cannot be led without a smart distribution grid at their foundation. The complex digital platforms need an access to reliable and high-resolution information, which could not exist without a robust and ambitious smart meter roll out across the continent. DSOs have already installed 100 million smart meters and deployments are still in progress. For example, here in France Enedis installs 30 000 smart meters a day.
New technologies such as Artificial intelligence and learning machines are the very first step of the upcoming transformation of the energy sector. It will enable innovation and breakthroughs far beyond what we can imagine today.
It is why some of you may be here today, on behalf of your company or organization, to represent these very specific niches, emerging services or high disruptive technologies. Indeed, you are all grid users and need digital, smart but also resilient networks, even when severe climatic events impact our grid.
This vital role, which we DSOs silently but continuously play in the background of any striving economy and society for security of supply, would not be possible without investments.
Without investments how can we develop R&I, digital platforms and cybersecurity infrastructure?
How can we turn an increasing volume of renewable resources into smart services, advanced business cases, and local energy communities?
How can we be cost-efficient via remote-sensing, self-healing networks and coupling across sectors and industries?
Yes, we have to invest intensively in IT and cyber technologies to become the data operators, dealing with pentabytes, needed by the customers and requested by the market players.
As I have said on the very beginning of my keynote, transforming our sector will require billions of investments! Our shareholders, whatever their business model is, need to be convince that this billions of € are definitively “good investments”. This is a clear message for our national Regulators and for ACER. Some of our members currently negotiate the grid tariff with their regulators, like in Finland. Our message to the regulators is : fair and smart tariffs are a must to reach the European climate goals.
What will our future look like? One thing only is certain for the coming years: the changes ahead are huge and have to be commonly faced.
The DSOs are strongly committed – as I hope you have noticed – to prepare our grids well for the smart technologies and innovative use cases.
We are already taking into account the lessons learned from the European projects. We are already industrializing all those innovations, like digital twins or data platforms, to make disruptions possible for all grid users;
Our common commitment, as DSOs, is to ensure a fair energy transition for all actors and increase social and political acceptance. All of you in this room are our stakeholders. We owe you more than power! We have to help you to take full advantage of the ongoing transition.
Definitively, our sector is becoming a really fascinating one and attracts more and more young talents! It is definitely an amazing period for all of us! Building this leading industry of green technologies and services to contribute cost-efficiently to the ambitious climate targets of the Paris Agreement, what a fantastic challenge!
I am looking forward to debating these issues with you in the coming days and wish you all an inspiring and connecting Utility Week! Thank you for your attention!