Thomas König - Digitalisation: Transforming, optimising & democratising energy | Digitalisation

Dr. Thomas König. Good morning everyone and a warm welcome to our third innovation day. Thank you, Christopher, for the friendly introduction. Can you imagine a life without digitization? Definitely not for me. This device is a perfect example of how digitization could change our lives radically and faster than we imagined. To kick off the day, I want to share some perspectives about digitization and introduce you to the digital energy world of E.ON. Recently, a colleague from Google at the Green Tech Festival described the energy transition as the largest digital project of all times. I strongly believe that digitization will change the way we do business like smartphones revolutionized communications and our daily life. So let's find out why digitization is so important for us and how a digital energy world could look like. We are at the beginning of a fundamental transition. We are switching off central controllable power stations and replacing them with hundreds of thousands of volatile renewables. This makes life as a network operator and energy provider much more complicated. Two main issues: complexity and uncertainty. Our networks were constructed for maximum load; we had reserve capacity and it was easy to distribute energy from big power stations cascading down. We needed no transparency and had almost no bottlenecks. Now we have millions of renewables feeding in, changing bottlenecks, and power flows in all directions. We need more transparency; we are equipping our networks with sensors, remote control, and building our own communication network that is secure and blackout-proof. The uncertainty is increasing day by day because we are shutting down controllable plants and adding volatile weather-dependent renewables. Demand is also more uncertain; in the past we used standard load profiles, now new appliances like storage, e-vehicles, fuel cells are connected. We have little experience with demand in this new world. A simple numerical example: in a fully meshed network with 5 participants, there are 10 possible connections. With thousands, complexity explodes. Such a system can no longer be controlled by human experience and intuition but only with digital support. That's why E.ON launched digitization in both segments: energy networks and customer solutions. Digitization for me is turning the real world into a digital one and capturing the value of data from our environment, grid control centers, customers, and assets to find new solutions. Digital twins enable simulations that seemed unthinkable a few years ago. We can simulate different future scenarios and predict where bottlenecks could occur. We can help customers save energy by simulating their behavior. On the picture you see one of our substations: real world and digital twin. We use 3D models for safety instructions for fitters. I took part in a digital fire drill and started sweating; the simulation was so real. The opportunities to use data are immense across the value chain: from automated grid planning, drone-based inspection, to chatbots. Now imagine a digitized, highly connected energy system. We could offer customers a flat rate for their whole energy consumption at lower prices, with no negative surprises, and even pay money back for demand flexibility. This already works – just google Timo Leucefield, the solar pioneer we work closely with. Our customers are at the center. Digitization helps manage their assets and enables local energy communities. We provide platforms for customers to use locally produced green energy and participate in real-time demand response. Imagine we could avoid bottlenecks before they occur. Weather forecasts are becoming more important. We use self-learning algorithms to understand dependencies between weather and production. Smart meters allow better consumption prediction. Combining better predictability on generation and demand keeps the system stable. Imagine our assets tell us when they need service. We install over 3,000 sensors per month, already 35,000 sensors in our networks. We use machine learning to predict network failures with higher accuracy than any human. These algorithms learn continuously, automatically, and independently. This picture shows a robot inspecting a substation. Using robots, drones, and AI, we automatically detect faults and remotely implement maintenance, lowering costs and downtime. Imagine supplying customers completely with green energy. We developed an energy monitor that shows in real time how much energy a community consumes and how it is produced. Cities can give transparency and calculate carbon footprint, take measures to reduce CO2, and track them. Energy networks provide the smart infrastructure; Carsten and his team offer solutions from energy efficiency consulting to PV and battery. Not only customers but the environment benefits. Overhead lines must be kept clear of trees; conventional practice leaves monotonous areas. E.ON implements ecological digital line maintenance using drones and satellite image recognition to minimize tree trimming, protecting the environment and saving money. One of my favorite examples: bird protection. Normally, power must be switched off for fitters to attach bird protectors. Now with digital control technology, a drone appears and equips the lines in seconds. This is good for animals, increases safety for employees, and at lower costs, in the best interest of customers. Isn't that great? Let me conclude. None of us can solve the task in an increasingly complex world alone. For decades, E.ON wanted to solve energy challenges on our own; we said goodbye to that approach. All digital solutions were developed with partners: universities, startups, big companies like IBM, SAP, Microsoft. Again, no one can solve the challenges of the energy transition alone. We need strong partnerships across boundaries. I enjoy this cooperative approach. Working together with partners with new ideas and an inspiring mindset makes more fun and opens new horizons. That's why I like the new E.ON brand campaign 'the we' – together we can make a difference. Together, the we has no limit. I look forward to an exciting day with you, meeting interesting people, and I wish you all fruitful discussions and new impulses from digitization and energy. Thank you very much.

Yeah, I gave you an example of predictive maintenance. This is where we collect real-time data, load data in our networks, and at the same time collecting data of failures. By combining and analyzing them, we are able to predict failures in the future. If you know that, you can do maintenance work before a failure occurs. So this is one of the great examples in our networks business.

Of course, no one of us has a crystal ball. Therefore, we are working with different scenarios and testing how robust our solutions are. We can't predict the future exactly, but our simulations give us a better feeling if we are on the right way and when and how we have to adjust. The scenarios give you the chance to respond to different kinds of possible things.

Of course, artificial intelligence has limits. I can tell you many of our employees and executives immediately feel a little bit of fear about these new technologies. They think, 'Hey, what is happening to me now? Is my job still safe? Do I have to work even harder and am I able to understand and operate the new technology?' So we have to be careful not to lose our people. For me, all the stuff I presented is only a tool to make life for our customers and employees easier. We have to be cautious doing the right things at the right time, not losing our customers and our employees.

What we do: first of all, we take their concerns seriously. When we work on a new idea or application, we involve our employees and customers from the very beginning and let them play a little bit so they get familiar with it. We consider their ideas and proposals. For example, we asked them how the interface should look like so they could work easily with new tools like a smartphone or tablet. If you involve people from the beginning, that makes life easier. We look for so-called power users who are enthusiastic about the applications. If they tell other colleagues, then it would be great if we could create an effect like 'I want it too' – almost like an ambassador.

Yeah, I showed you a substation as one example. But at the moment we are really transforming our complete networks into a digital twin. Here we can test which capacity we need at what time in which area, based on different scenarios. This makes grid planning much easier. Another example: only in Germany we have more than 800,000 renewables in our networks. Each one asks if it can be connected. With these models, we can automatically give them within seconds an answer: yes it's possible, or not yet but in three months or a year depending on the situation.

First of all, we have 25,000 kilometers of our own fiber networks in Germany. We use these networks for our own communication within the system. Now we use this backbone to offer our customers broadband as well. This is one part of our portfolio where we want to grow over the next years, year by year. We are spending more than 100 million each year in expanding the networks and connecting our customers to the fiber networks.

I don't see Google as a threat. I think we can learn a lot from Google: their platform technology, their knowledge about customers, the way they explore the power and value of data. This inspires me. We try to make the best of both worlds, learning from them and applying their thinking on our business. I think it's not that easy to enter our business because assets and owning the assets plays a major role. You need a physical link between generation and consumption. You can't transport electrons via Bluetooth. Not many have such deep knowledge of networks like we have in Europe and the world. So only having the digital twin is not enough.

Yeah, we have many things in the pipeline. For me, the most important is really capturing every single small scale flexibility in our networks, aggregating it to bigger items, and trying to simulate a virtual power plant that is as controllable as a fossil-fueled power plant. This is one thing we are working on, and hopefully we can roll it out and scale up in the next 12 to 18 months.

DSR... help me with the abbreviation? Demand side response? This is what I gave as an example at the very beginning. We are also working with DSR, especially in local communities, where we test in real life in a smaller project how we can use demand flexibility to keep the grid stable.

Definitely. One thing I can tell you, and I think no one knows that really: for me, the most innovative digital idea was to make the maximum use of the existing infrastructure. As I told you at the beginning, for many years our network was more or less blind. Now we put the light on in our networks and exactly know what's happening. By that, we increased the utilization of our grids tremendously. Without that steering, it hadn't been possible to connect more than 800,000 renewables to the grid without any failures. This was the greatest example in energy networks.

Yesterday, Carsten told us a little bit about smart homes. That is one application where we can make use of digitization. Analyzing the behavior of a family in the house – when they wake up, what temperature they need, when they need light and heating – we try to explore that and make proposals on how they can save energy without any loss in comfort or quality of life. If you know that and can steer devices, you can save at least 10 to 20%. These are the numbers we experience in our pilot projects.

Effective question. I think we are at the very beginning. For now, all these new applications are more or less for the techies. I don't think all of our customers already know what's possible today. It is our job to make them aware what's possible now and how these new applications can make their life easier and more comfortable.

All in all, I think we have adequate regulations in the different countries in Europe where we operate. Of course, if I look 10 or 20 years ahead, we need adjustments in the regulatory frameworks because most of them were created in a time when the net was more or less stable without dynamic development. They are still mainly incentivizing the old stuff – investing in heavy metal – not in digitization and software. We have to modernize and further develop our regulatory regimes. This is something we will definitely rely on partnerships to create that not all the knowledge has to come from within.

The whole world is getting so complex and so difficult I would say that you can't solve all the problems on your own. Again, for me, I learned so many things in the discussions with other companies, and combining their ideas with our ideas, that is really where innovation happens. Therefore, I really love this cooperative approach.

I wouldn't say fully autonomously, but my vision – and maybe I'm too visionary – is that in 10 years, no unplanned outages should occur, only planned interruptions because of predictive maintenance. In 10 years, we know a failure before it happens, so we can send fitters to fix it without turning the power off. In a completely meshed network, we will always find ways to keep power running. My vision: no unplanned outages and a self-healing network with few interferences by human beings.

Of course. As the example showed you before, some great ideas, for example using satellite data and recognition patterns, were developed by a young startup in Germany. In the future, we are opening a sandbox, in my words, and inviting startups to test their ideas in real life. We have defined a network area in Brandenburg where they can experiment with their ideas. Hopefully this brings us additional new ideas to get even better.

Okay, good question. If you would ask my 20-year-old son, I think he would answer 'Hey, my father is a digital Neanderthal.' But without joking, of course I personally use digital applications like Apple Music. My house has home automation – I can control lights, heating, safety cameras with my smartphone. I am very proud to be one of the first ones to install a smart meter in a cellar. So, yes, I'm on the road.