Smaller rural power companies are a lot like small rural telcos in that they tend to be heavily vested in their local communities. If residents are clamoring for faster Internet, the local power company or telco generally will try hard to get it for them.
One power company that has worked hard to bring high-speed broadband to customers that can’t get it today is Midwest Energy Cooperative, which provides electrical service to parts of rural Michigan, Indiana and Ohio. Telecompetitor talked recently with Dave Allen, who is Midwest Energy’s vice president of regulatory compliance, and Patty Nowlin, director of communications for the company, about the company’s current and future broadband initiatives.
“As an electric cooperative, we’re responsive to what members are looking for,” said Allen. “We hear regularly that ‘We would like broadband.’ We’re responding to consumer demand that rural America gets the same thing [the rest of] America gets. People who live in our area need to be productive. They need [broadband] to apply for jobs and do homework.”
Last year the company’s Midwest Communications unit launched gigabit service over fiber-to-the-premises infrastructure in several Michigan communities as part of a broader initiative to bring FTTP to its entire southwest Michigan service area. That achievement topped off more than a decade of work toward meeting broadband goals.
Utility Company Broadband
Midwest Energy’s initial foray into Internet service began with 56 kbps broadband dial-up back around the year 2000. In 2004, the company began selling satellite broadband through an agreement with Wild Blue, which was later acquired by ViaSat.
With strong demand “the beams filled up quickly,” noted Allen.
But when the satellite service that Midwest Energy was buying was shut down later in that decade, Midwest Energy decided to try delivering Internet service using broadband powerline (BPL) technology. The electric cooperative made some limited deployments but had to abandon that approach when its supplier IBEC went out of business.
At the time IBEC attributed its shutdown to a tornado that hit its Huntsville, Alabama headquarters. But technical difficulties with BPL technology also may have played a role in that decision.
Around the same time, Midwest Energy began looking at modernizing its power distribution infrastructure and enlisted an engineering firm for help with that. Two-way communications is critical to advanced power distribution technology and to obtain that, the engineering firm recommended that Midwest Energy undertake a fiber deployment and that it also consider deploying FTTP as part of that initiative.
In 2014 Midwest Energy committed to a five-year FTTP buildout throughout its southwest Michigan service territory. Since then it has been deploying FTTP using a crowdsourcing approach that targets deployments based on where residents express the greatest demand.
Allen and Nowlin shared several stories about how Midwest Energy FTTP has benefited communities where it is available. A business customer that works with large CAD drawings is now able to send them to other parties electronically whereas in the past employees sometimes took the drawings home on a thumb drive to send them using speedier home connections, noted Allen.
Nowlin added that some people have purchased homes based on where they could get FTTP service, or have been able to stay in their current homes after previously considering a move to gain broadband. She also noted that Midwest Energy has some customers for gigabit service who operate their own servers.
Moving Forward
After trying unsuccessfully to get broadband stimulus funding for its BPL deployment, Midwest Energy did succeed in winning some funding through the FCC Rural Broadband Experiments (RBE) program for its FTTP deployment. The company has been provisionally awarded $211,000 to help cover some of the costs for two communities where it is the local electric provider and where one of the price cap carriers is the incumbent telco.
Midwest Energy’s commitment to deploy FTTP throughout its southwest Michigan service area will mean building in additional markets where a price cap carrier is the incumbent – but there also are some parts of its territory where a small rural telco is the incumbent. In those areas, Allen said Midwest Energy will be talking with the telco about “how we can partner” on broadband.
Stories similar to that of Midwest Energy could be playing out in other parts of the U.S. as well, as the company is just one of several non-traditional communications service providers – along with other power companies and some broadband wireless providers — that won RBE funding. Non-traditional players also are likely to be bidders in the upcoming Connect America Fund auction that will award up to $1 billion or more to help bring broadband to parts of price cap carrier territories where those carriers declined funding.
