Source - EU DSO Entity Technical Vision (2024)

Full title: Technical Vision — The Value of Distribution System Operators for European Customers Publisher: EU DSO Entity (European Distribution System Operators’ Entity for the implementation of network codes and guidelines) Year: 2024 Pages: 36 File: Raw/PDF extractions/Technical-Vision-2024-Final-report-/Technical-Vision-2024-Final-report-.md

About the EU DSO Entity

The EU DSO Entity was established under the Clean Energy Package (Directive 2019/944 Art. 52) as the representative body of European distribution system operators. It works alongside ENTSO-E and co-drafts network codes including the Network Code on Demand Response.

As of the document date:

• 830+ DSOs represented
• 250 million+ customers served
• 27 EU member states covered
• Represents the full range: from large multi-national DSOs to small municipal operators

Overview

The Technical Vision sets out the EU DSO Entity’s strategic perspective on the role of DSOs in the energy transition. It is organized around four core development areas — Planning & Investment, Market Facilitation, Operations & Maintenance, Resilience & Sustainability — with Digitalization as an enabling foundation for all four. The document is also a call to cooperation with ENTSO-E, the European Commission, ACER, and all network users.

Chapter 3.1 — Planning and Investment

Investment volumes

The document estimates DSO investment needs of €55–67 billion per year to enable the energy transition — covering grid expansion, reinforcement, and modernization across the EU. This positions DSOs as the single largest capital investment segment in the European electricity infrastructure.

Anticipatory investments

A central concept introduced: investments that proactively address expected future developments on a medium-to-long-term horizon (10–20 years), not just immediate connection queue requests. The rationale:

• Grid must not become a bottleneck for the energy transition
• Earlier investment avoids costlier later upgrades
• Investors and market participants need visibility on future grid capacity well ahead of actual connection requests

The document links this directly to DNDP harmonization — DNDPs should reflect anticipatory planning and be aligned with TSO Network Development Plans.

DNDP — EU harmonization need

The Technical Vision explicitly calls for harmonized EU DNDP definitions and methodologies to improve comparability and planning coordination across member states. It advocates for:

• Consistent 10–20 year planning horizons
• Alignment between DSO DNDPs and TSO NDPs
• Transparency on where future grid capacity will be available (useful for investors and RES developers)

Links to: Distribution Network Development Plan, Source - DSO Entity DNDP Good Practices (2024), Source - ACER CEER DNDP Guidance (2025).

Chapter 3.2 — Market Facilitation

Five flexibility opportunity areas

The document identifies five areas where DSO action can unlock distributed flexibility:

These map directly onto the Network Code on Demand Response NC DR workstreams (national T&C processes, product standardization, flexibility register, DNDP reporting).

Energy sharing and energy communities

The document supports the role of DSOs as enablers of energy sharing under the Clean Energy Package. It describes a “many-to-many” energy sharing model where:

• Active customers can share self-generated or stored renewable energy with other customers at a distance (offsite sharing) or with others via contracted rights
• DSOs must manage and facilitate this while maintaining system stability
• An Energy Sharing Provider (ESP) role is identified as an emerging intermediary

The DSO’s role: manage the metering, settlement, and grid operation that enables sharing. The Technical Vision links this to the growing importance of Energy Communities and the need for harmonized EU legislation on REC/CEC status. (Energy Communities)

Dedicated Measurement Devices (DMDs)

DMDs (also “dedicated measuring devices” or DMDSs in the glossary) are a key enabling tool: metering devices installed at DER connection points to validate power output, distinguish between types of DER, and provide the data needed for flexibility service verification. The document signals DSO support for obligatory DMD installation for controllable DER above certain thresholds — directly relevant to NC DR prequalification requirements.

Chapter 3.3 — Operations and Maintenance

Active system management

As DER volumes grow, DSOs need to move from passive to active system management: effectively handling bidirectional power flows, procuring flexibility services for congestion management, and coordinating with TSOs on reserve delivery from distribution-connected units. Digital technologies — AI, digital twins, smart metering — are identified as key enablers.

Dynamic ratings

The document explicitly mentions Dynamic Ratings (equivalent to Dynamic Line Rating) as an operations tool: “Dynamic Ratings optimize asset use by allowing real-time adjustments to transformer and line limits, reducing conservatism and unlocking capacity.” Presented as part of the broader digitalization-enabled operations toolkit alongside power flow control.

Chapter 3.4 — Resilience and Sustainability

Climate adaptation

• DSOs play a key role in identifying vulnerable grid areas and reinforcing critical assets
• DNDPs should be used to plan climate resilience investments alongside flexibility
• TSO-DSO collaboration needed to streamline procurement of EU-manufactured grid components (higher sustainability and security standards)
• Climate adaptation and climate mitigation are framed as dual DSO contributions

Cybersecurity

The integration of DER, smart appliances, and EVs multiplies grid connectivity and cyber attack vectors. The document presents a three-tier cybersecurity framework:

Regulatory anchor: Network Code on Cybersecurity — the document calls for consistent application across the value chain. DSOs must implement the current framework while advocating for evolution; calls for NIS2 alignment and for hardware supply chain security standards to reach mass-market device manufacturers.

Chapter 3.5 — Digitalization

Digitalization is presented as the cross-cutting enabler for all four development areas, not a separate development track. Key themes:

DSO as data custodian

DSOs are positioned as the primary data custodians for customer and system data at the distribution level:

• Planning: better data → improved load forecasts, better anticipatory investment decisions
• Market facilitation: smart meters + DMDs + IoT → verified DER data for flexibility services
• Operations: real-time monitoring, predictive analytics, dynamic ratings
• Resilience: early fault detection, faster recovery, cybersecurity integration

Decentralized Data Space

The central digitalization concept: a DSO data space comprising a set of interoperable, decentralized data spaces that DSOs collect, use, and share. Features:

• DSO data space integrates customer data, smart meter data, DER data, grid topology data
• Interoperable with TSO, aggregator, and other market participant data spaces
• Privacy-compliant: strong data security measures; respects GDPR
• Contributes to the EU-wide European Data Space initiative — harmonized, interoperable, secure data across the energy sector
• DSOs “are at the beginning of their data journey” — significant challenges remain

Harmonized definitions for roles and responsibilities in data exchange are needed; DSO Entity supports EC in developing these.

Conclusion and Call to Cooperation

The Technical Vision concludes with explicit calls to cooperation:

• ENTSO-E: increased cooperation for system operation, market integration, planning and investment
• European Commission and ACER: forward-looking regulatory adjustments aligned with net-zero; ensure flexibility is enabled and incentivized
• All system players: competitive, resilient, efficient, customer-centric power system reinforcing EU industrial leadership

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