Looking at your output it looks like you are using an old version of PowerShell:

C:\Windows\System32\WindowsPowerShell\v1.0>

Per the Dell Storage API PowerShell SDK Getting Started Guide the Prerequisites are:

• Windows PowerShell 4.0 or higher.
• .NET Framework 4.5 or higher.
• Windows 32–bit or 64–bit operating system.

Verify that you have PowerShell 4.0 with the get-host command:

The Help for this command shows:

NAME Start-DellEmDiscoveredStorageCenterDiscover

SYNOPSIS Gets the list EmDiscoveredStorageCenter objects that are available on the same subnet as the EM Data Collector or localhost

SYNTAX Start-DellEmDiscoveredStorageCenterDiscover -Connection  " []"

DESCRIPTION This method gets the list EmDiscoveredStorageCenter objects that are available on the same subnet as the EM Data Collector or localhost. Note that layer 2 multicasting must not be blocked between the host and the Storage Center for it to show up here.

With the correct version of PowerShell, and a good connection the output will show:

Thank you for trying to help me.

Just to make sure. 

I'm running the commands from a Windows Server 2016 host PowerShell version is 5.1.14393.2580

Installed .Net Framework: 4.7.03062

Dell Storage API: v3.5

The commands I execute on the Physical Host which has the network ports on the same VLAN as the Storage Center from an elevated shell. The SC also attached by SAS cables. (The installed SM Client application can see the uninitialized Storage Center) The Data Collector is installed on a different server.

PS >Import-Module dellstorage.apicommandset
PS >$DCSecureStringPassword = ConvertTo-SecureString -AsPlainText "" -Force
PS >$StorageCenterConnection = Connect-DellApiConnection -HostName "
  " -User "Admin" -Password $DCSecureStringPassword
PS >$StorageCenterConnection

Connection Connected BaseConnection
---------- --------- --------------
ApiConnection True ApiConnection

PS >Start-DellEmDiscoveredStorageCenterDiscover -Connection $StorageCenterConnection 
Start-DellEmDiscoveredStorageCenterDiscover : StorageCenterError - Network Communication error
At line:1 char:29
+ ... geCenters = Start-DellEmDiscoveredStorageCenterDiscover -Connection $ ...
+ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
 + CategoryInfo : SecurityError: (DellStorage.Api...overStartCmdlet:DellEmDiscovere...overStartCmdlet) [St
 art-DellEmDis...eCenterDiscover], DellStorageApiMethodException
 + FullyQualifiedErrorId : ConnectionError,DellStorage.Api.CommandSet.Cmdlets.DellEmDiscoveredStorageCenterDiscover
 StartCmdlet
 

The prerequisites of doing this via PowerShell are the same as when using the Dell Storage Manager (DSM) Client:

From Dell Storage Manager 2016 R3 Administrator’s Guide: https://topics-cdn.dell.com/pdf/storage-sc2000_administrator-guide_en-us.pdf

Discover and Select an Uninitialized Storage Center
The first page of the Discover and Configure Uninitialized Storage Centers wizard provides a list of prerequisite actions and information required before setting up a Storage Center.
Prerequisites

• The host server, on which the Storage Manager software is installed, must be on the same subnet or VLAN as the Storage Center.
• Temporarily disable any firewall on the host server that is running the Storage Manager.
• Layer 2 multicast must be allowed on the network.
• Make sure that IGMP snooping is disabled on the switch ports connected to the Storage Center.

Since you show: Start-DellEmDiscoveredStorageCenterDiscover : StorageCenterError - Network Communication error
The PowerShell commands are using the Data Collector to connect. Your output shows you can connect to the Data Collector. I would verify that you can also pass via the DSM Client from the Data Collector server to determine if you need to disable the firewall and/or allow Layer 2 multicast from the Data Collector.

Okay new update. 

I tried to discover the Storage Center from the Data Collector, and it gives me the same non helping error. 
Do you know where there might be any logs that might be more useful. 
I have turned on the Debug Loggers for several things but only the Compellent API gives me this error. Which is the same: 

When running it from PowerShell:

Any more ideas what could be the problem? What could be the next step in debugging the cause of the problem?