Siemens plans to invest 1 billion euros ($1.1bn) over the next five years in a new start-ups unit to help it develop businesses in particular areas, one being the field of decentralised electrification.

The funds will be available to employees, external start-ups and established companies if they want to pursue business ideas in fields that are strategic to Siemens’ future, the group said on Tuesday.
Siemens sign
In its fact sheet pertaining to its plans for decentralised electrification, Siemens say that many individual energy transformations will have to take place around the world if the climate goal is to be reached.

“The decentralized electrification innovation field involves fundamental structural change in the areas of electricity generation, supply and distribution. These changes will be performed by a large number of market players, ranging from major corporations and grid operators to regional alliances and private micro units that will take the place of a few large central units.”

“More and more renewable energy will be produced centrally and on a decentralized basis, a development that will continuously drive down the price of such power.

To optimize the entire system, Siemens experts are exploring future energy systems as part of a research project called “Energy System Development Plan” (ESDP).

In the study, experts are simulating how an increased level of renewable energies will impact not only power generation and transmission, but also distribution and the market as a whole over the long term.

“The trend involving electrified and multimodal grids is unmistakable: In the future, the number of power electronic converters used in the energy supply system will rise steeply. Converters will play an important role in such areas as grid storage, photovoltaic systems and pumps.”

“Because individual energy systems for electricity, heating and air-conditioning, gas, and mobility are increasingly evolving into multimodal systems, researchers are hunting for ways that will enable different energy sources to interact in these systems. A key role will be played by small and medium-sized power plants that will be operated on a decentralized basis.”

The new unit will come into being on Oct. 1 and will initially be headed by Siegfried Russwurm, Siemens’ chief technology officer. It will have offices in Berkeley, California, Shanghai, China and Munich, Germany.