diff --git a/config/config.default.yaml b/config/config.default.yaml
index 10e6a6ed..78c1385c 100644
--- a/config/config.default.yaml
+++ b/config/config.default.yaml
@@ -623,9 +623,9 @@ clustering:
 solving:
   #tmpdir: "path/to/tmp"
   options:
-    formulation: kirchhoff
     clip_p_max_pu: 1.e-2
     load_shedding: false
+    transmission_losses: 0
     noisy_costs: true
     skip_iterations: true
     track_iterations: false
diff --git a/doc/configtables/solving.csv b/doc/configtables/solving.csv
index cba28cbe..c252ff32 100644
--- a/doc/configtables/solving.csv
+++ b/doc/configtables/solving.csv
@@ -1,7 +1,7 @@
 ,Unit,Values,Description
 options,,,
--- formulation,--,"Any of {'angles', 'kirchhoff', 'cycles', 'ptdf'}","Specifies which variant of linearized power flow formulations to use in the optimisation problem. Recommended is 'kirchhoff'. Explained in `this article <https://arxiv.org/abs/1704.01881>`_."
 -- load_shedding,bool/float,"{'true','false', float}","Add generators with very high marginal cost to simulate load shedding and avoid problem infeasibilities. If load shedding is a float, it denotes the marginal cost in EUR/kWh."
+-- transmission_losses,int,"[0-9]","Add piecewise linear approximation of transmission losses based on n tangents. Defaults to 0, which means losses are ignored."
 -- noisy_costs,bool,"{'true','false'}","Add random noise to marginal cost of generators by :math:`\mathcal{U}(0.009,0,011)` and capital cost of lines and links by :math:`\mathcal{U}(0.09,0,11)`."
 -- min_iterations,--,int,"Minimum number of solving iterations in between which resistance and reactence (``x/r``) are updated for branches according to ``s_nom_opt`` of the previous run."
 -- max_iterations,--,int,"Maximum number of solving iterations in between which resistance and reactence (``x/r``) are updated for branches according to ``s_nom_opt`` of the previous run."
diff --git a/doc/release_notes.rst b/doc/release_notes.rst
index 14f2939d..3af16477 100644
--- a/doc/release_notes.rst
+++ b/doc/release_notes.rst
@@ -25,6 +25,10 @@ Upcoming Release
 
 * Remove ``vresutils`` dependency.
 
+* Add option to include a piecewise linear approximation of transmission losses,
+  e.g. by setting ``solving: options: transmission_losses: 2`` for an
+  approximation with two tangents.
+
 PyPSA-Eur 0.8.0 (18th March 2023)
 =================================
 
diff --git a/envs/environment.yaml b/envs/environment.yaml
index f970c9ba..9d800fdc 100644
--- a/envs/environment.yaml
+++ b/envs/environment.yaml
@@ -10,7 +10,7 @@ dependencies:
 - python>=3.8
 - pip
 
-- pypsa>=0.21.3
+- pypsa>=0.23
 - atlite>=0.2.9
 - dask
 
diff --git a/scripts/solve_network.py b/scripts/solve_network.py
index 8f4fdf5b..e671ffd3 100644
--- a/scripts/solve_network.py
+++ b/scripts/solve_network.py
@@ -600,6 +600,7 @@ def solve_network(n, config, opts="", **kwargs):
     track_iterations = cf_solving.get("track_iterations", False)
     min_iterations = cf_solving.get("min_iterations", 4)
     max_iterations = cf_solving.get("max_iterations", 6)
+    transmission_losses = cf_solving.get("transmission_losses", 0)
 
     # add to network for extra_functionality
     n.config = config
@@ -613,6 +614,7 @@ def solve_network(n, config, opts="", **kwargs):
     if skip_iterations:
         status, condition = n.optimize(
             solver_name=solver_name,
+            transmission_losses=transmission_losses,
             extra_functionality=extra_functionality,
             **solver_options,
             **kwargs,
@@ -623,6 +625,7 @@ def solve_network(n, config, opts="", **kwargs):
             track_iterations=track_iterations,
             min_iterations=min_iterations,
             max_iterations=max_iterations,
+            transmission_losses=transmission_losses,
             extra_functionality=extra_functionality,
             **solver_options,
             **kwargs,