Why Rural Electric Co-Ops should be Dominating the Rural Broadband Market

August 9 – 10:30 am to 11:15 am
Plaza Ballroom A

Moderator

Josh Leonard

Burns & McDonnell: Broadband Business Lead

Rural communities have historically been an afterthought when it comes to America’s modernization efforts. Broadband internet service is essential to modern life, providing benefits such as: improved healthcare, enhanced learning opportunities, increased efficiency for local businesses, and much more. New federal funding provides a unique opportunity for Electric Co-Ops aggressively modernize broadband services. There is also increasing accessibility to collaborative partners when combined with electric cooperatives which enable a natural advantage for providing broadband access.

According to the Federal Communications Commission (FCC), electric co-ops currently provide 30% of fiber services in rural America while maintaining 42% of the electric distribution lines. Electric co-ops also provide reliable power to 56% of the U.S. land area. They often have a natural advantage through their existing fiber “backbone” which allows them to transmit data from the smart grid to a central location for analysis and decision making. This is usually made of high-count fiber cables enabling daily grid operation and has the potential to also enable broadband connectivity.

Some cooperatives have concerns about participation in rural broadband expansion including funding, the risk involved when setting up a new business, and finding the human resources it takes to act as an ISP (Internet Service Provider). Luckily, the financial and human resourcing risks can be mitigated through enablement partnerships and federal funding.

Cooperatives have the unique advantage of utilizing existing infrastructure to “follow the power”. In addition to infrastructure, Cooperatives may leverage existing staff, service trucks, and other resources. This enables electric co-ops to modernize grids and enter the rural broadband market at a lower risk and entry cost. This also positions electric co-ops to decide what role they wish to play in solving the digital divide.

The first step in modernizing broadband services is to expand the high bandwidth backhaul fiber network. Expanding this network into underserved communities can also provide access to last mile consumers using Gigabit Passive Optical Network (GPON) technology. Expanding a backhaul fiber network requires capital investment. Current funding from the federal government includes initiatives like the FCC Rural Digital Opportunity Fund (RDOF), the United States Department of Agriculture (USDA) eConnectivity Pilot Program, American Rescue Plan (ARPA) funds, and now the largest portion includes a $42.45 billion Broadband Equity, Access, and Deployment (BEAD) program which is now being deployed state by state.
Grid modernization and rural broadband access require a large fiber network expansion. Utilities and Electric Cooperatives should focus on their strengths as utility providers, having a strong infrastructure. They then can utilize partnerships with capital investors, engineering service providers and ISPs to form a cohesive and cost-effective service plan for their customers. Energy generation capacity, aging infrastructure, renewable energy demand, and the mass transition for Electric Vehicles (EVs) should all be significant concerns for rural electric co-operatives when it comes to finding a path forward in our nation’s push for grid modernization, and it all starts with rural broadband access by building out a solid fiber backbone.

Please join us for this special event where Josh will host a panel discussion on the opportunity for Electric Utilities and Electric COOPs to take an active role in helping to close the digital divide. We will discuss current broadband market conditions, capital funding opportunities both public and private, internet service provider partnerships, P3 partnerships, and a shared mission to help close the digital divide!

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