# Presentation: 356566

## Broadband over Power Line:U.S. Innovation Driving Economic Growth

**Michael D. Gallagher**
- Assistant Secretary for Communications and Information
- National Telecommunications and Information Administration
- U.S. Department of Commerce
- Denver, Colorado
- September 16, 2005
- www.ntia.doc.gov

## The President’s Broadband Vision

- 	*“**This country needs a national goal for broadband technology . . . universal, affordable access for broadband technology by 2007.” *	–   President George W. Bush,                   Albuquerque, NM, March 26, 2004*	*

**Government’s Role**
*"The role of government is not to create wealth; the role of our government is to create an environment in which the entrepreneur can flourish, in which minds can expand, in which technologies can reach new frontiers."** **                              * – President George W. Bush, Technology Agenda, November, 2002

- President Bush speaking at the U.S. Department of Commerce on June 24, 2004.

## Overarching Goal:Promoting Economic Growth

- Thanks to the President’s policies, America’s economy is strong:
- GDP grew 3.3% in 2Q05 and 3.6% during the past 4 quarters, above the averages of the past 3 decades.  During the past 4 quarters, EU25 GDP grew 1.3% and euro-zone GDP grew 1.2%.
- The economy has shown job growth for 27 straight months and added nearly 4.2 million new jobs since May 2003 – more than Canada, France, Germany, Great Britain, and Japan combined.
- Over the past four years, productivity grew at its fastest 4-year rate in over 50 years.
- 169,000 new jobs added in August – the U.S. unemployment rate is 4.9%, while the EU25 unemployment rate is 8.8%.
- Manufacturing activity (ISM index) has been growing for 27 straight months – the longest period of growth in 16 years.
- National homeownership is 68.8%, near its record high of 69.2% in 4Q04.

## Benefits of Broadband

*“**[B]roadband will not only help industry, it’ll help the quality of life of our citizens.”*— President George W. Bush, US Department of Commerce, June 24, 2004
- Tele-Medicine
- Distance Learning
- Tele-Work
- National Security
- Jobs and Economic Growth

##  Creating Economic Conditions For Broadband Deployment 

- Tax relief has given businesses powerful incentives to invest in broadband technology:
- Accelerated depreciation for capital-intensive equipment.
- Extension of the Internet tax moratorium until Oct. 31, 2007; support making it permanent.
- An 18-month extension of the research and experimentation tax credit; support making it permanent.
- President's FY 2006 budget requests a record $132 billion for research and development.
*“**We ought not to tax access to broadband.  If you want something to flourish, don’t tax it.”*
- 				- President George W. Bush in Baltimore, Maryland on April 27, 2004.

##  Creating Economic Conditions For Broadband Deployment (cont’d)

- Reducing legacy regulation of broadband services:
- The Administration supports the FCC’s order freeing newly deployed broadband infrastructure from legacy regulation.
- The Administration also supported policies that will ensure that VoIP is free from unnecessary economic regulation, while mindful of the importance of law enforcement and emergency services.
- Spurred by the President’s Executive Memorandum, the Administration instituted reforms in April 2004 in rights-of-way management across federal lands, including standardizing applications, speeding decisions, and setting reasonable fees.

## Largest Broadband Markets in the World Top Ten by Number of Broadband Lines

- Source: Point Topic, June 30, 2004 – December 31, 2004

## Source:  FCC

## Source:  FCC

## Growth in Broadband Lines1999-2004

## Types of Broadband Lines1999-2004

## Broadband Over Power Lines: Enabling the Third Wire

-    *“**We need to get broadband to more Americans . . . one great opportunity is to spread broadband throughout America via our power lines.”* — President George W. Bush, US Department of Commerce, June 24, 2004
- The FCC began a BPL rulemaking on February 12, 2004.
- Principal concern was the risk that BPL systems might interfere with licensed radio communications.
- BPL system deployment allowed under the Commission’s existing Part 15 rules
- Asked what frequencies are preferred for BPL
- Sought comments on potential interference from BPL systems to radio communications
- Requested comments on compliance measurement procedures

**HomePlug Modem** can turn an electrical outlet into an Internet connection.

## Broadband Over Power Lines: Enabling the Third Wire

- Based on additional analyses, NTIA recommended several supplements to the FCC proposed BPL rules to reduce risk of BPL interference (June 2004).
- The FCC adopted rules incorporating most NTIA recommendations on October 14, 2004.
- NTIA Phase 2 study evaluating effectiveness of newly adopted rules in reducing the risk of BPL interference is nearing completion.
- Today, many utilities, hotel operators and others are deploying experimental and operational BPL systems.

**NTIA Radio Spectrum Measurement System**

- NTIA submitted to the FCC a Phase 1 study that defined interference risks and potential mitigations (April 2004).

## Rules Adopted by the FCC Protect Federal and Non-Federal Spectrum Users  

- BPL industry to establish database with information needed for interference identification and resolution.
- BPL providers are required to employ adaptive interference mitigation techniques (e.g., frequency avoidance).
- BPL systems:
- Must incorporate capabilities to modify their operations to “notch out” any specific frequency.  Minimum depth of frequency notches: 20 dB below 30 MHz and 10 dB above 30 MHz.
- Are required to avoid operating in 74.8-75.2 MHz aeronautical frequencies.
- Must have remote shutdown capability.
- Are authorized under the FCC’s certification procedures.
- Aeronautical receive station consultation areas have been established.
- Procedures established for advanced consultation and notification for safety-of-life and public safety operations.
- Radio astronomy and U.S. Coast Guard maritime public coast receive station exclusion zones have been established.
- Certification measurement procedures enhanced to accurately characterize emissions from BPL systems.

## Broadband Over Power Lines: Current Deployments

- Source: UPLC, Sept. 2005

## Broadband Over Power Lines:Current Deployments

- Source: UPLC, Sept. 2005

| Deployment | Location | Details |
| --- | --- | --- |
| Arizona Public Service – Mitsubishi  | Cottonwood, AZ | technical trial  |
| Ameren -  Main.net  | Cape Girardeau, MO | 500 homes passed/70 end users  |
| AEP – Amperion  | Dublin, OH | 132 homes passed/2 end users  |
| CenterPoint Energy – Mitsubishi/Amperion  | Houston, TX | BPL pilot + technology center for utility apps.  |
| Central Virginia Electric Cooperative – IBEC  | Nelson County, VA | 4000 homes  |
| Cinergy – Current Technologies  | Cincinnati, OH | commercial deployment to 50,000 homes passed  |
| City of Manassas – Main.net  | Mannassas, VA | City-wide deployment to reach 20,000 end users |
| City of Solvay, NY – New Visions  | Solvay, NY | Commercial deployment; government funding fromState of NY |
| ConEdison – Ambient  | Briarcliffe Manor, NY | 1st  trial in US  |
| Consumers Energy – Shpigler Group  | Grand Ledge, MI | commercial deployment to 1000 homes passed  |
| Cullman Electric Cooperative – IBEC  | Cullman, AL | rural trial  |
| Duke – Main.net  | Charlotte, NC | ramping up to 15,000 users  |
| Duquesne – Amperion  | Pittsburg, PA | newest BPL deployment  |
| HECO --Current Technologies  | Honolulu, HI | 100 home trial  |
| Hilco Elec. Coop – Amperion  | Glen Heights, TX | 100 home development  |
| IdaComm – Amperion  | Boise, ID | 25 end users  |
| City of Salem, VA -- Amperion  | Salem, VA | 10 subs, 100 homes passed  |
| PEPCO – Current Technologies  | Potomac, MD | 115 subs  |
| PPL – Main.net/Amperion  | Allentown, PA | 17,000 homes passed  |
| San Diego Gas & Electric – Ambient  | San Diego, CA | recently announced  |
| South Central Indiana REMC  | Martinsville, IN | to reach 33,000 customers  |
| Southern Company – Main.net/Amperion  | 
Birmingham, AL   | technical trial |

##  Broadband Over Power Lines:Market Achievements & Challenges 

- Technology Development
- HomePlug and other power line chipsets developed to operate in the “noisy” power line environment, with 2nd generation products on the way.
- Various means to “bypass” the electric step-down transformer to connect customers on each low voltage line to BPL signals on the medium voltage distribution line.
- Access to Capital
- Growing interest in BPL from strategic investors:
- Goldman Sachs, Hearst and Google recently invested in CURRENT Communications.
- Motorola and Mitsubishi are developing their own BPL solutions.
- IBM entering the BPL market as a system integrator.
- Intel and Cisco recently invested in HomePlug BPL chip maker Intellon.

- Source: CURRENT Communications, LLC,  Sept. 2005

##  Broadband Over Power Lines:Market Achievements & Challenges 

- Utility Interest
- Although utilities tend to be conservative when adopting new technologies, a number of them have shown an interest in being the first in their regions with BPL.
- Other encouraging factors are utility interest in enhanced utility applications such as:
- BPL-enabled electricity meters that enable time-of-day and real-time pricing through automated meter reading.
- Load control devices that allow for enhanced load management functions.
- Automated outage and restoration detection.
- Preventative maintenance by monitoring the distribution network for problem signs before they result in power outages.
- Enhanced utility applications are seen as the key driver for utilities to consider BPL deployment.

- Source: CURRENT Communications, LLC,  Sept. 2005

##  Broadband Over Power Lines:Market Achievements & Challenges 

- Regulatory Uncertainty is Dissipating
- The FCC released its Report and Order on Access BPL in October 2004.
- The NARUC BPL Task Force Report in February 2005 recommended a “light-handed” regulatory approach to BPL.
- Texas legislation encourages utilities to deploy (or permit 3rd parties to deploy) BPL, and similar proceeding are underway in other states such as California, Indiana and Illinois.
- Energy Policy Act of 2005 encourages utilities to employ advanced technologies for distribution network maintenance and operability.
- Market Growth
- Telecom Trends International estimates BPL market to grow from $57.1 million in 2004 to $4.4 billion in 2011.
- Research and Markets Inc. estimates that BPL subscribers will grow at a CAGR (compound annual growth rate) of 106% between 2006 and 2012, and that 1/3 of new US broadband customers and 13% of existing broadband customers will choose BPL by 2012.

- Sources: “BPL’s Growing Pains”, Rural Telecommunications, July 1, 2005, and CURRENT Communications, LLC,  Sept. 2005.

##  Broadband over Power Lines:The Six Things You Need to do to Comply 

- Access BPL systems must be designed and operated in a manner
- that avoids harmful interference to licensed radio operations.
- Before initiation of service:
- Use equipment authorized by the Commission for this application.
- Supply all required information to the Access BPL Database manager, and to the State Public Utility Commission(s).
- Consult with local public safety users, and with federal users in areas designated as consultation areas.
- Be aware of and avoid operating at frequencies in use within areas designated as exclusion zones.
- During operation:
- Address cases of suspected interference in a timely manner.
- Cease operations immediately at the location where interference to public safety services is suspected.

## Expanding Competition:Wireless Broadband and New Technologies

- Advanced Wireless Services (“3G”)
- Ultra-wideband
- 5 GHz Spectrum

- The Administration has made more radio spectrum available for wireless broadband technologies:

*“**The other promising new broadband technology is wireless. The spectrum that allows for wireless technology is a limited resource . . . [a]nd a wise use of that spectrum is to help our economy grow, and help with the quality of life of our people.”*  							-- President George W. Bush, June 24, 2004

## Moore Meets Marconi: Wireless Applications

-  _**Wi-Fi:**_ Until recently, the utility of Wi-Fi phones was limited to businesses and colleges. Companies such as Nokia, Flarion, IDT, Motorola, Cisco, and SpectraLink are beginning to develop hardware and software to facilitate Wi-Fi telephony.
-  _**WiMax:**_ Intel plans to build WiMax into its Centrino chip platforms, which power 80% of all PCs, by 2006.  InStat/MDR estimates that a company could reach 97.2% of the U.S. population with a $3.7 billion investment in WiMAX.
-  _**Unlicensed Mesh Networks:**_ By linking nodes on an ad hoc basis, mesh technology promises to deliver high bandwidth wireless coverage to areas that lack wired infra-structure, and can link diverse devices or networks.  Champaign-Urbana Community Wireless Network (CUWin) in Illinois has offered free 1.5 Mbps Internet access on a mesh network since 2002.** **

## Conclusion

- Achieving the President’s broadband vision will improve the lives of our citizens and promote economic growth.
- BPL is emerging as a viable third broadband wire into the home.
- Utilities see enhanced utilities applications as the key driver to  deployment of BPL.
- Careful design and operation of BPL systems are essential to successful co-existence with nearby radio communications.