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The evolution of the electrical grid industry in Germany by 2020

Explore one of the most critical infrastructure undertakings of the German “Energiewende” or energy transition.


Much public attention has been focused on the four transmission system operators responsible for transporting electricity nationwide. The power grids, designed for the local and regional distribution of electricity, on the other hand, remain largely ignored. This is interesting since around 98 % of Germany’s approximately 1.78 million kilometers of electrical network is made up of these distribution grids. Around 97 % of renewable energy producers feed their electricity into the grid at this level. Grids designed originally for the simple distribution of electricity are, in the wake of the ‘Energiewende’, now confronted by considerable challenges; the work they do and the demands they must fulfill are central to the transformation of the power industry.

The paper provides an empirically robust outlook on the prospects of Germany’s distribution grid operators. 

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Key Findings

The paper is based upon a survey conducted according to the Delphi approach, in which 28 experts from the power supply and grid industries were asked for their views on the crucial themes and developments in the grid industry over the next eight years.

  • Fragmented market structure and regional specifications pose challenges

  • Two in three experts doubt that the grids will be expanded in time and that investments in smart technologies will keep pace

  • Incentive regulation promotes consolidation, while de-privatization counters it

  • Focusing on core business and market opportunities for technology providers

  • Virtual power plants could be a game changer in the distribution grid market