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France Germany: A look at the digital transition of the electricity sector


Published 19 Décembre 2016



This year, the GEM (Grenoble Ecole de Management) Barometer and its German counterpart ZEW have asked French and German experts for their opinion on the digitization of the electricity sectors in France and Germany. In France, the survey was carried out in May-June 2016 with 97 participants. There were many enlightening findings.

Brandeburg Gate, Berlin – Photo credit: Markus Spiskes in CC

The GEM Barometer of the energy market is a biannual survey conducted in France of experts in the energy market operating in industry, science and public administration. These experts are invited to give their short-, medium- and long-term assessment of the evolution of national and international energy markets. The European Economic Research Center ZEW, for its part, is carrying out a similar barometer for Germany.

A useful digital transition, but considered too slow on both sides

According to experts, the first three areas where digitization of the electricity sector is likely to create efficiencies in France are: improved forecasting for load management on the grid, greater flexibility of the demand of the industry sector and better “dispatching” of electricity generation. On the other hand, more than half of French experts believe that the rate of transformation is too slow. In Germany the feeling is the same.

A slightly more optimistic appraisal in Germany

58% of French experts estimate that France is close to the average of Western countries regarding progress in the area of the digital transformation of the electricity sector. German experts are more positive about the progress of digitization in their country. A majority of experts believe that the level of digitization is higher than the average.

Principal barriers to digitization

GEM researchers asked the experts to identify the factors that impede the digitization of the electricity sector, and to specify which factor they consider the most important. The two groups of French and German experts unanimously believe that the state of the art of technology is not a major obstacle.

The cost-benefit ratio divides German and French experts

The cost-benefit ratio is considered unfavorable by 31% of French experts and 38% of German experts. To them it constitutes the most important obstacle to digitization. Nearly a quarter of te French and a third of German experts think the opposite: the cost-benefit ratio does not, in their opinion, constitute a barrier for digitization in the electricity sector.

“This suggests that the expectations of technology experts regarding what can be achieved, and at what price, varies considerably,” conclude the authors of the Barometer.

Regulation as the second brake in France against cybersecurity in Germany

French experts place the regulatory framework second among the obstacles to digitization. Cybersecurity ranks third. Their German colleagues place cybersecurity in second place.

Digitization vs cybersecurity

Should emphasis be placed on technical aspects and support for the introduction of ICTs into the electrical system, or should cybersecurity be preserved above all?

Around 21% of experts in France feel that the emphasis has been rather on digitization. A share roughly equal to 23% believes that cybersecurity has been favored. However, most respondents (39%) believe that the electricity industry has followed a balanced approach between the technical aspects of digitization and the preservation of cybersecurity.

In Germany, only 16% of respondents believe that cybersecurity has been favored. 27% think that the emphasis is on digitization and 26% believe that a balanced approach is followed.

Expected benefits of digital transformation

French and German experts agree on the areas where digital transition will produce the most efficiency gains: 21% of French and 20% of German experts mention improved predictions for load management on the grid.

16% of French experts and 17% of German experts cite a better distribution of electricity production. Finally, 11% of French experts and 16% of German experts point out operational procedures (such as billing).

Digitization should also improve the flexibility of demand in industry. Hence, 18% of French experts and 19% of German experts anticipate greater flexibility in the industry among regions benefiting from digitization.
Advantages for consumers do not seem to be taken for granted: less than 10% of French experts and 11% of German experts believe that private households will benefit from greater flexibility.

 

 

ITEMS International pour Think Smartgrids

 

Source: Baromètre du marché de l’énergie (GEM), summer 2016