This white paper, developed as part of the InnoCyPES project funded by the European Union’sHorizon 2020 program, explores the transformation of traditional energy distribution grids into Cyber-Physical Energy Distribution Systems (CyPEDS). This evolution is driven by key forces such astechnological advancements, grid decentralization, and decarbonization efforts. The report presentsa novel framework that integrates the Smart Grid Architecture Model (SGAM) with advanced dataworkflows, providing a structured methodology to uncover interdependencies between critical driversfrom both academia and industry. This framework is used to extract two innovative use cases, illustratingthe significant potential for innovation in the energy distribution sector. Innovative Use Cases Peer-to-Peer Asset Management: This use case investigates the potential of decentralized datastorage and privacy-preserving analytics to enhance resource allocation and improve regulatorytransparency for Distribution System Operators (DSOs). By leveraging distributed data systems, itenables more efficient asset management and operational decisions. Virtualized Hybrid Grid Operation: This use case demonstrates how real-time data analysisand cyber-physical applications can facilitate the coordinated management of hybrid AC/DC grids.It highlights the potential for better integration of renewable energy sources and improvements ingrid stability through advanced digitalization. Key Objectives Comprehensive Data Management: The report emphasizes the crucial role of end-to-end datamanagement, from data acquisition to advanced analytics, across the energy system’s lifecycle.A robust digital infrastructure is essential for enabling informed decision-making and optimizingsystem performance in CyPEDS environments. Policy and Business Alignment: Beyond technological innovation, the paper stresses the needfor aligning business models with policy incentives to promote digitalization in the energy sector. Astrategic regulatory framework is essential for fostering investment and expediting the deploymentof digital technologies, ensuring that innovation and operational efficiency go hand in hand. The white paper concludes by offering insights into the practical implementation of these innovations,outlining the challenges faced in real-world applications, and discussing the broader implications for thefuture of energy distribution. These advancements in CyPEDS not only pave the way for more efficientand resilient energy systems but also support long-term goals of sustainability, decentralization, anddecarbonization.