Tomorrow's energy supply – local, sustainable and intelligentCIRED – The 21st International Conference and Exhibition on Electricity Distribution

Dr. Andreas Roß, Managing DirectorFrankfurt, June 6, 2011

CIRED, 6.06.2011 2

Our vision for Germany’s future energy supply

Tomorrow'senergy supply –

local, sustainable and intelligent

CIRED, 6.06.2011 3

City of Frankfurt am Main

100 %

Stadtwerke* Frankfurt am Main Holding GmbH

75.2 %

Thüga AG

24.4 %

Diversified holdings

0.4 %

NRM Netzdienste** Rhein-Main

GmbH

Mainova ServiceDienste

GmbH

Mainova EnergieDienste

GmbH

SRM Straßen-Beleuchtung***

Rhein-Main GmbH

Stadtwerke* Hanau GmbH

10 %

90% 100 % 100 % 100%

Mainova AG (Frankfurt), N-ERGIE AG (Nuremberg),

Stadtwerke* Hannover AG, Kom9

Corporate structure

Thüga Holding GmbH & Co. KGaA100 %

*Public utilities **Network services ***Street lighting

CIRED, 6.06.2011 4

Bremen

Rhineland-Palatinate

Saar-land

Baden-Wuerttemberg

Bavaria

ThuringiaHesse

North

Rhine-Westphalia

Lower Saxony

Saxony-Anhalt

Saxony

Berlin

Brandenburg

Mecklenburg-West Pomerania

Schleswig-Holstein

HamburgBremen

Rhineland-Palatinate

Saar-land

Baden-Wuerttemberg

Bavaria

ThuringiaHesse

North

Rhine-Westphalia

Lower Saxony

Saxony-Anhalt

Saxony

Berlin

Brandenburg

Mecklenburg-West Pomerania

Schleswig-Holstein

HamburgBremen

Rhineland-Palatinate

Saar-land

Baden-Wuerttemberg

Bavaria

ThuringiaHesse

North

Rhine-Westphalia

Lower Saxony

Saxony-Anhalt

Saxony

Berlin

Brandenburg

Mecklenburg-West Pomerania

Schleswig-Holstein

Hamburg

Network area of NRM

Frankfurt and vicinity

Hanau and Groß-krotzenburg

Main-Spessart

Network area of NRM

Supply task Network length

Electricity approx. 4 billion kWh approx. 7 400 km

Gas approx. 23 billion kWh approx. 4 300 km

Water approx. 45 million m3 approx. 2 000 km

Heat approx. 2 billion kWh approx. 260 km

CIRED, 6.06.2011 5

Facts and figures

Business model:Planning, building, operation and maintenance of electricity, gas, heat and water supply networks

Shareholders:Mainova AG (90%),Stadtwerke Hanau GmbH (10%)

Start of business operations:July 1, 2005

Registered office:Frankfurt am Main

Employees:Approx. 1,000

Turnover:Approx. EUR 550 m

CIRED, 6.06.2011 6

640

650

660

670

680

690

700

710

720

730

740

750

760

770

780

Jahr

Jah

resh

öch

stl

ast

(MW

)

Pmax (MW) 664 689 693 683 672 683 711 707 731 748 778

Datum 12.01.2000 27.08.2001 19.02.2002 13.01.2003 15.12.2004 21.06.2005 13.07.2006 20.06.2007 25.06.2008 02.07.2009 12.07.2010

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Development of annual peak loads in power supply network of Frankfurt (2000-2010)

114 MW(+17%)

Winter peakSummer peak

An

nu

al P

eak

Lo

ad

(M

egaw

att)

CIRED, 6.06.2011 7

Current customer projects of NRM in Frankfurt

ModernisationDeutsche BankElectricity: approx. 6 MVAHeat: approx. 7 MW

Tower 185Electricity: approx. 10 MVAHeat: approx. 7 MW

New building of data processing centreElectricity: approx. 14 MVA

New building of European Central Bank

Electricity: approx. 10 MVAHeat: approx. 7 MW

CIRED, 6.06.2011 8

Why “local”and

why “sustainable”?

CIRED, 6.06.2011 9

Nuclear exit and the shift in energy policy require a sustainable, decentralised energy system

Power generation in Germany is still characterised by:

large central power plants

an oligopoly (E.ON, RWE, EnBW, Vattenfall)

an energy mix with close to 2/3 coal and nuclear power (status 2009)

However, to realise the nuclear exit and the energy system transfor-mation, we increasingly need:

decentralised generation capacities

utilization of renewable energies

bundling of municipal competence (capital and brain power)

German power plants 100 megawattsSource: Umweltbundesamt

CIRED, 6.06.2011 10

CHP share of at least 25%Combined heat and

power

CO2 neutrality20% of CO2 neutral power generation

15% of which are from renewable energies

Reduction of CO2

emissions

Saving of 550,000 tons of CO2 up to 2015

Sustainable, decentralised energy supply taking Mainova as an example

Main pillars of Mainova's generation strategy up to 2015

Mainova: planned investments of about 500 million euros up to the year 2015

According to the Verband kommunaler Unternehmen VKU (Association of Municipal Utilities), public utilities plan to invest additional 6 billion euros by 2020 in the event of a rapid nuclear exit1)

1) cf. www.finanztreff.de, May 8, 2011

CIRED, 6.06.2011 11

Sustainability and decentralisation offer advantages for citizens, municipal politics and administration

From our point of view, sustainability and decentralisation offer different advantages:

Strengthening the scope of municipalities to take action: political co-determination and subsidiarity

Acceptance by citizens: guaranteed implementation

Knowledge of location: planning reliability

Well-established relationship with local authorities: prompt action

CIRED, 6.06.2011 12

Why “intelligent”?

CIRED, 6.06.2011 13

A sustainable, decentralised energy system requires intelligence – especially in the networks!

We need intelligent networks to solve technical challengessuch as

dealing with future load development

managing fluctuating power in-feeds

balancing supply and demand

reducing network losses

avoiding investments by better managing concurrence

integrating electricity, gas and heat in generation, storage and transport

But we also need – above all – intelligence in the networks to solve strategic issues such as

What does the energy system of the future look like?

Who are the players and what roles will they play in this system?

Which roles will network operators assume?

How can the key processes of the network business be linked intelligently to the processes of other players (Smart Cities, eGovernment, Smart Mobility, etc.)?

CIRED, 6.06.2011 14

"Smart grids" have to be implemented differently at each of three levels!

Level: transmission system operators

"Electricity highways" (transnational transport and load balancing)

System stability

Level: regional distribution system operators

Investment requirements to handle in-feed from renewable energies

Increasingly fluctuating in-feed

Level: municipal distribution system operators

Load management ("balancing")

Integration of the electricity, gas and heat sectors in generation, storage and transport

CIRED, 6.06.2011 15

Extension and restructuring of networks requires investments!

Different estimates are currently available for the investment requirements to extend and restructure networks to become smart grids:

Verband kommunaler Unternehmen – VKU(Association of Municipal Utilities):

- 25-30 billion euros by 20301)

Bundesverband der Energie- und Wasserwirtschaft – BDEW(German Association of Energy and Water Industries):

- up to 27 billion euros by 20202)

Bundesnetzagentur (German regulation authority):

- 20-40 billion euros spread "over many years"

1) cf. Position paper of VKU regarding the role of the public utilities in smart grids of the future from January 2011

2) cf. BDEW study on distribution networks 2011

3) cf. Der Westen, May 9, 2011 (newspaper of WAZ Media Group)

CIRED, 6.06.2011 16

Thank you for your attention!