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electric utilities as ISPs


JRM
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The utility I work for has been installing a fiber network to run a smart grid\smart meter technology.  What I just learned today was that our company is working on legislation to allow it to operate the fiber network as an internet service provider to existing electric customers.

 

Has anybody else heard of anything like this before?  My initial thought is this is an egregious abuse of monopolistic power.  The capital cost of building out this fiber network is re-couperated in electric rates, so they should be able to undercut competitors.  Not to mention that the electric utility, who owns the utility poles, has the ability to deny new pole attachments for competitors.

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The electric co-op that provides electricity to my airbnb in central NH is starting to talk about doing this.  Although they are talking about starting in rural areas that do not have broadband at all presently and eventually offering it to all customers over a number of years.  I have 250Mbps service at my lake-house already through the cable company, but that is my only option.  The way I look at it is if NHEC eventually offers this to me it will double my options.  Cable companies already have monopolies in most areas, so competition is a good thing.

 

https://www.nhec.com/broadband/

 

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Guest cherzeca

The utility I work for has been installing a fiber network to run a smart grid\smart meter technology.  What I just learned today was that our company is working on legislation to allow it to operate the fiber network as an internet service provider to existing electric customers.

 

Has anybody else heard of anything like this before?  My initial thought is this is an egregious abuse of monopolistic power.  The capital cost of building out this fiber network is re-couperated in electric rates, so they should be able to undercut competitors.  Not to mention that the electric utility, who owns the utility poles, has the ability to deny new pole attachments for competitors.

 

how do you know that your utility will be able to include all of the fiber costs in the rate base?  if the fiber serves a part electric service/part internet service function, there may be some allocation of costs....which would make sense if as you would expect there are one rate payers not using the ISP

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All customers are sharing the cost of our transmission upgrades which include smart grid upgrades.  This has already been reviewed and approved by our PSC.  The fiber has already been installed in many areas.

 

All costs of running an ISP certainly won't be covered, but the expensive part is the massive fiber build out.

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Guest cherzeca

All customers are sharing the cost of our transmission upgrades which include smart grid upgrades.  This has already been reviewed and approved by our PSC.  The fiber has already been installed in many areas.

 

All costs of running an ISP certainly won't be covered, but the expensive part is the massive fiber build out.

 

well that seems fair. the fiber cost had to be incurred for an upgraded electric service reason. additional revs from ISP functionality "might" keep electric rates lower since the utility will be earning more from its installed rate base

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Guest cherzeca

it could definitely be good for the customer and still be anti-competitive.  will be interesting to see what happens.

 

anti-competitive is a term of art legally...usually, it means it will lead to higher price for consumers, not tsouris for competitors.  I dont see how a bad result for consumers would result here...likewise with FB action...where consumers get more service at no cost as FB adds services

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it could definitely be good for the customer and still be anti-competitive.  will be interesting to see what happens.

 

anti-competitive is a term of art legally...usually, it means it will lead to higher price for consumers, not tsouris for competitors.  I dont see how a bad result for consumers would result here...likewise with FB action...where consumers get more service at no cost as FB adds services

 

I mean anti-competitive in the sense that they could (in theory) hinder competitors from building out fiber networks quickly. 

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I can see the case of an utility coming in and offering broadband when there isn’t really any competitive offering, like is the case in many rural areas. In those cases there are even subsidies to offering broadband. Some of the smaller telecoms like NUVR do a pretty  nice living getting their Capex subsidized via A- CAM funding and I can’t see why they wouldn’t allow the electric utility to do something along the same lines to provide broadband to customers as well.

 

I guess some rules would need to be established to prevent double dipping of the utility but I can’t see why there couldn’t be a workable solution, After all every household pretty much gets electricity unless it is totally of the grid. So why not offering broadband  to underserved communities as well through the utility?

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Guest cherzeca

Yes sir.  I'm hesitant to disclose the utility I work for, not sure why.  It's a Fortune 500 company that operates in the midwest.

 

if your employer is doing this, then every utility is going to do this.  that has always been my experience. haven't railroads also used rights of ways and easements to do this as well (or at lease them to ISPs)

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Yes sir.  I'm hesitant to disclose the utility I work for, not sure why.  It's a Fortune 500 company that operates in the midwest.

 

JRM,

 

Please call me John [ : - ) ]. Actually, I'm right now in the eye of a storm related to that. [-And it'll end up being just great for my household! [The Ruler of the House & I - no kids at home , two old buggers, -you know].

 

I'll try to allocate some time to provide a post to this topic within the next few days, that [perhaps] makes some sense and creates some perspective, based on my own experiences, and a good deal of [Danish] home bias. [ : - ) ]

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