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NARUC JOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONS BROADBAND OVER POWERLINES. NARUC JOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONS BROADBAND OVER POWERLINES Wade P. Malcolm, P.E. Understanding Utility Responses to BPL February 13, 2006 NARUC. Wade P. Malcolm, P.E. Vice President

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NARUC JOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONS BROADBAND OVER POWERLINES

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Naruc joint meeting electricity and telecommunications broadband over powerlines

NARUCJOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONSBROADBAND OVER POWERLINES


Naruc joint meeting electricity and telecommunications broadband over powerlines wade p malcolm p e

NARUCJOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONSBROADBAND OVER POWERLINESWade P. Malcolm, P.E.


Understanding utility responses to bpl february 13 2006 naruc

Understanding Utility Responses to BPLFebruary 13, 2006NARUC

Wade P. Malcolm, P.E.

Vice President

Power Delivery and Markets


Introduction

Introduction

  • Broadband over powerline (BPL) technologies offer new opportunities for electric utilities to leverage their infrastructure for

    • Commercial broadband communication services

    • Utility applications

      • outage detection and management,

      • automated meter reading (AMR)

      • demand response programs


Background

Background

  • BPL experience

    • Utility pilot programs

    • Deployments of commercial BPL services

  • State and federal regulators have encouraged expanding reach of broadband

  • Pace of utility BPL adoption slower than hoped

  • Regulators question how to encourage BPL deployments


Regulatory interest in bpl

Regulatory Interest in BPL

  • Regulatory interest in BPL has primarily been driven by three factors:

    • The desire for a “third wire” – a broadband alternative to cable and DSL providers that could introduce additional competition into the market;

    • The potential for BPL to extend broadband service to rural areas that are currently underserved; and

    • The potential for BPL to enable a more flexible, self-healing power grid that would be more robust in the face of either natural or man-made disasters, including terrorist attacks


Objectives and approach

Objectives and Approach

  • National Association of Regulatory Utility Commissions (NARUC) asked EPRI to help better understand utility responses to BPL

  • EPRI conducted

    • literature search

    • interviews with utilities

      • some who have embraced BPL

      • some not


Key questions

Key Questions

  • Why some utilities embrace BPL while others are uninterested – even in the same regulatory environment?

  • Why some utilities focus primarily on internal applications of BPL (i.e., smart grid) and others view it primarily in terms of offering broadband communications services?

  • Do the benefits of BPL for internal utility applications in fact outweigh the costs?


Key references cited

Key References Cited

  • Clark Gellings and Karen George, Broadband Over Powerline 2004: Technology and Prospects. An EPRI white paper, 2004

  • Karen George, BPL Market Update and Teleconference Highlights. A Primen Customer Insights Perspective (CI-PP-10), 2004

  • Consumer Portal Telecommunications Technology Assessment (DRAFT, v2). EPRI, 2005

  • BPL coverage in mainstream and industry press

  • BPL providers websites


Utilities interviewed

Utilities Interviewed

  • Cinergy--Greg Wolf, VP, Cinergy Ventures

    • Largest commercial BPL deployment

  • Consumers Energy--Gerry Wyse, Manager of Distribution Planning and Performance

    • Commercial broadband pilot

  • South Central Indiana REMC--Kevin Sump, CEO

    • Commercial broadband deployment

  • Con Edison—Tim Frost, Director of Corporate Planning

    • BPL viewed as utility application

  • Central Hudson Gas & Electric —John Chrysler, R&D Administrator

    • Study led to conclusion not to pursue BPL

  • First Energy —EileenBuzzelli,Managing Director, New Products

    • Measured approach for piloting BPL


Characteristics of enthusiastic bpl utilities

Characteristics of Enthusiastic BPL Utilities

  • Municipal utility status

    • They face fewer regulatory uncertainties

    • There is only one set of stakeholders– the municipality’s ratepayers/taxpayers/citizens

  • Geographically compact service territories that make deployments more cost-effective

  • Existing fiber networks that the utility can leverage such as those of Cinergy and PPL

  • Significant potential for broadband service growth

  • A successful history of offering services other than commodity electric power


Commercial services vs utility applications

Commercial Services vs. Utility Applications

Commercial service

  • Strategic commitment to new services and technology investments by senior management

  • Unregulated subsidiary to pursue new opportunities

  • BPL service providers partnering with utilities and assuming risk

    Utility application

  • To stay close to their core business and “what they know”


Cost effectiveness of bpl for utility applications

Cost-Effectiveness of BPL for Utility Applications

  • High deployment cost

  • BPL ranked eighth of nine technologies for wide-area networks (WANs) in IntelliGrid architecture

  • Low marks on standardization and use of object modeling (tied to lack of technical maturity)


Utility applications criteria

Utility Applications Criteria

  • Level of standardization

  • Ease of obtaining and using the technology

  • Current level of adoption

  • Degree of users’ group support

  • Security

  • Manageability

  • Scalability

  • Use of object modeling

  • Use of self-description or meta-data

  • Applicability to the power industry

  • Applicability to consumer services


Other concerns with bpl

Other Concerns With BPL

  • Lack of electrical current (power outage) disrupts some advanced IntelliGrid functions that wide-area networks would be intended to enable

    • Load shedding in an emergency situation with a finer degree of control than is currently possible,

    • Load redistribution by using demand response customers as a “fast reserve,”

    • Monitoring and controlling distributed generation at a customer’s site

  • Alternative technologies such as WiMAX, radio frequency, paging, or wireless communications could still be active in case of a power outage


Why some utilities are moving slowly on bpl deployment

Why Some Utilities Are Moving Slowly on BPL Deployment

  • Risk aversion

    • Smaller utility: Don’t have resources to risk being on “bleeding edge” of technology deployment

    • Larger utility: “Careful pilots, careful implementation”

    • Business models not proven

  • Questions remain about technology

    • Quality compared with other broadband technologies

    • Live up to hype? “Show me what it can do”

    • Scaling issues

    • Integration with meters a problem


Conclusions

Conclusions

  • Regulatory matters are not a strong driver to BPL responses

  • Strong drivers:

    • Management approach to new business opportunities and risk; CEO philosophy

    • Technical characteristics of BPL

    • Business considerations

      • ROI

      • Risk tolerance

        Responses are driven by individual company attitudes and business performance measures


The grid of the future intelligrid

The Grid of the Future: IntelliGrid


The consumer portal

“A combination of hardware and software that enables two-way communication between energy service organizations and equipment within the consumers’ premises.”

The Consumer Portal


Technical issues

Technical Issues

  • Some Remain:

    • Standardization

    • Compatibility with new classes of assets

    • Radiated Noise?

  • One Approach:

    • Interest Group forming to address long term technical issues

  • Interested?

    • Contact [email protected]


Naruc joint meeting electricity and telecommunications broadband over powerlines walt brown

NARUCJOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONSBROADBAND OVER POWERLINESWalt Brown


Naruc joint meeting electricity and telecommunications broadband over powerlines steve houle

NARUCJOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONSBROADBAND OVER POWERLINESSteve Houle


Naruc winter meeting txu bpl initiative

NARUC Winter MeetingTXU BPL Initiative

Steve Houle

Vice President

Corporate Technology & Development


Creating the 21 st century grid

Creating The 21st Century Grid

Digital protection and control

Transmission superconductivity

Advanced substation equipment monitoring and video security

Digital fault analysis; self-healing grid

Automated Meter Reading

Broadband over Powerlines


Smart grid benefits timeline

Smart Grid Benefits - Timeline

S

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N

S

O

L

U

T

I

O

N

E

N

A

B

L

E

E

N

A

B

L

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E

N

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B

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Senate bill 5 key enabling bpl provisions

Senate Bill 5 – Key Enabling BPL Provisions

  • It is in the public interest to encourage the deployment of BPL

  • A utility may choose to implement BPL, but is not required to do so.

  • Municipality shall not have jurisdiction over the BPL system, services, construction, operation, or maintenance. Texas BPL policies should provide regulatory certainty and remove barriers to entry.

  • No additional fees, franchises, or easements required for BPL system

  • BPL services to utilities are eligible expenses in rate cases

  • CATV pole attachment rate is just & reasonable


Bpl utility services benefits

BPL Utility Services Benefits

  • Advanced Metering

    • Reduced meter reading and field service O&M

    • Automated disconnect (reconnect)

    • Outage restoration verification

  • Network Monitoring

    • Improved system operational responsiveness

    • Reduced reactive transformer maintenance costs

    • Improved outage information

  • Substation Automation Services

    • Enhanced communications and control of substations

    • Enables additional substation monitoring technologies

    • Reduced leased circuits for substation communications


Naruc joint meeting electricity and telecommunications broadband over powerlines gerald wyse

NARUCJOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONSBROADBAND OVER POWERLINESGerald Wyse


Naruc joint meeting electricity and telecommunications broadband over powerlines

BPL Deployment at Consumers Energy

NARUC 2006 Winter Committee Meetings

Washington, DC

February 13, 2006


Electric distribution system

Electric Distribution System

  • 1,730,000 Customers

  • 29,768 Square mile service territory

  • 925 General Distribution Substations

  • 59,000 Miles of distribution primary lines

  • 545,000 Distribution transformers

  • 20,000+ New customers annually


Business model selection

Business Model Selection

  • Of all the business models being considered by utilities, the Landlord approach was chosen and a commercial market pilot approved.

  • Low risk approach

  • Leverages the core competencies of the utility

  • Avoids affiliate transaction issues

  • Can be done within the existing regulatory environment


General terms of the agreement

General Terms of the Agreement

  • The Shpigler Group receives the right to provide BPL Service to two communities and will market under Lighthouse Broadband (A total of 10,000 customer passed) - 1st community – Grand Ledge- 2nd community – St. Johns

  • Deployment is a Market Pilot - No Investment on Consumer Energy’s part- No Commitment for further deployment- Mutual sharing of information to determine post pilot direction


Pilot communities

Pilot Communities

  • Grand Ledge5350 Potential customers 574 Overhead transformers 482 Pad mount transformers 6 Customer per transformer

  • St Johns4950 Potential Customers 482 Overhead transformers 178 Pad mount transformers 7.5 Customers per transformer

St Johns

Grand Ledge


Consumers energy s objectives

Consumers Energy’s Objectives

  • Evaluate low risk Landlord Strategy for BPL

  • Determine Utility Application potential

  • Determine implications and potential for statewide deployment

  • Evaluate BPL as an Economic Development tool for more competitive broadband options in Michigan communities


Current status

Current Status

  • Grand Ledge Commercial Deployment- Network up and running - Continuing with deployment

  • St Johns Commercial Deployment- Permit process proceeding - Meetings recently held with City Officials and 911 Personnel- 2006 Deployment


Naruc joint meeting electricity and telecommunications broadband over powerlines1

NARUCJOINT MEETING: ELECTRICITY AND TELECOMMUNICATIONSBROADBAND OVER POWERLINES


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