Danilo Bestini*, Rocco Cicoria*, Sergio Corti*, Gianni Celli**, Susanna Mocci**, Fabrizio Pilo** CIRED 19th International Conference on Electricity Distribution, Vienna 21-24 Maggio 2007 *CESI RICERCA **Università di Cagliari The opportunities deriving from the innovative operation of the distribution systems have been underlined in the Literature and might be useful to accomplish economic, environmental and reliability targets by overcoming the existing barriers to innovation and liberalized market. However, despite such widely accepted conclusions, there is still the lack of methods and tools to help Distribution System Operators (DSO) guide the transition from present distribution systems to the future ones. Furthermore, DSO are well conscious that the transition will necessarily be a step-by-step procedure lasting for several years and claiming for a careful optimization of investments. The paper aims at addressing such crucial questions by using a network planning methodology based on the principle of dynamic programming. In particular, the optimal multi-year development plan of active distribution networks is found by solving a suited set of one- stage problems. Such methodology can be applied under the assumption of saving investments from one year to the successive. The solution of the planning problem gives the yearly network evolution in the study period that minimizes the capital and operational expenditures (CAPEX&OPEX). Real-world examples are provided to illustrate the effectiveness of the multi-year planning methodology for active distribution networks.