“a growing number of utilities are becoming convinced that BPL is worthy of serious attention, even if only a handful remain ready to begin deployment

[April 05, 2006]


Broadband over Power Lines: Ready or Not?

By Mae Kowalke
TMCnet Associate Editor

A recent Pike & Fischer report titled “Broadband over Power Lines: Is it Ready to Charge Up?” finds that, while electric utilities control an important wire into American homes, “there are not a lot of options for new market entry that make good economic sense.”


The report points out that “a strategically important question is whether these networks can use broadband-over-power-line technologies to reliably and cost-effectively deliver broadband services.”

Examining this question, Pike & Fischer reviews the recent history of interest in BPL deployments, which the report says has peaked twice:
During the summer of 2005, Google, Goldman Sachs Group and Hearst Corp. jointly invested $100 million in BPL technology and services provider Current Communications Group. That fall, TXU Electric Delivery, Texas’ largest retail supplier of electricity, announced a deployment of Current’s BPL technology to as many as 2 million customers in the Dallas-Fort Worth area and other Texas communities.


In 2004 Current “announced an initial 50,000-home deployment in Cincinnati with Cinergy, which serves 1.5 million electric customers in Ohio, Indiana and Kentucky.”
Pike & Fischer noted that in the Cincinnati deployment, Current formed a joint venture with Cinergy, whereas in Texas it set out to provide broadband services on its own. (TXU agreed to pay $150 million over ten years for the use of Current’s BPL network.)

But the jury is still out as to whether BPL deployments will be profitable, Pike & Fischer cautions in the report.

The report attempts to answer the profitability question by examining highlights from the January 2006 BPL Demo conference in San Diego, hosted by utility-industry associated United Power Line Council.

Round-table discussions at the event brought to light some predictions and points relevant to the BPL industry.
Panelists said that, although BPL may not yet be ready for primetime, it probably soon will be—at least for some companies in the industry.


As a group, utilities seem unlikely to change their conservative ways, especially in light of the fact that questions remain about the maturity of BPL technology.


BPL does have potential economic advantages for supporting both internal utility applications and commercial broadband services; in fact, a “dual-use” strategy could help BPL become competitive in the broadband market.


Companies looking at BPL deployments need to approach the topic from three different fronts: technological, regulatory, and market front. This is true regardless of whether the perspective is from the utility industry itself or some other marketplace sector seeking to compete with BPL.
Pike & Fischer round out the discussion in their report with points brought up by specific speakers at the BPL Demo conference.

A few examples:
Joe Cufari, Current’s vice president of business development, said that early BPL initiatives focused on commercial broadband services, whereas the focus now is on “smart grid” applications for delivering core services more efficiently and reliably.


Steve Houle, vice president of corporate technology and development at TXU, said his company is not interested in retail broadband services, but instead sees value in pursuing dual-use strategies.


Bob Geradri, manager of Duke Power’s (now Duke Energy) powerline communication division, said his company has yet to find a vendor that can meet its requirements in terms of level of scale. He also indicated that Duke intends to play a direct role in deploying commercial broadband as a wholesaler. His view was that BPL is not quite ready yet.


Leif Ericson, Southern Telecom’s manager of business development, said he thinks BPL is 90 percent ready, but predicted that the last 10 percent will be the hardest to achieve. His company in the past few years has undertaken a few smallscale BPL trials.


Steve Greene, Amperion’s senior director of business development and regulatory affairs, said BPL may or may not be ready, depending on one’s goals.
According to Pike & Fischer, “a growing number of utilities are becoming convinced that BPL is worthy of serious attention, even if only a handful remain ready to begin deployment.”



The new 200 Mbps BROADBAND over POWER LINES Technology