Lessons for Communities

Lessons for Communities

Isen

–

“Salter, you got anything for us?”

Salter
–

“No”

Isen

–

“Good, Come share that with us”



James Salter, President



1
st

FTTH Build
–

Began in 2001

Borough of Kutztown, PA (3,000
Homes)

32
nd

FTTH Build
–

2012

Google Fiber, Kansas City (
More than 3,000
Homes)

Our FTTH Footprint

Up to now,
I
’ve only had 4 Ideas, and
I’m not sure any were original?

1.
The Demand for Bandwidth Will Not
End

2.
Fiber is the only answer to bandwidth

3.
If a Community believes they need
bandwidth, they should build it
themselves

4.
Open Access won’t work in US model

My 5
th

Idea….

1.
US is 15% built with FTTH

2.
US should be 100% built with FTTH

3.
Electric Utilities should build, or at
worst partner, on the remaining 85%

Why Electric Utilities?

1.
Don’t believe Major ILEC’s nor MSO’s
will significantly ramp FTTH builds
–

wireless is king

2.
Biggest hurdle to FTTH build is access
to ROW
–

electric utilities own 80% of
easements in US

Our FTTH Footprint

Why Electric Utilities?

1.
Don’t believe Major ILEC’s nor MSO’s
will significantly ramp FTTH builds
–

wireless is king

2.
Biggest hurdle to FTTH build is access
to ROW
–

electric utilities own 80% of
easements in US

3.
Second biggest hurdle to FTTH is
recovering cost in lower density areas
–

electric utilities can significantly
close that financial gap
IF

they
ACTUALLY

implement
REAL

SmartGrid

Utility Capital Investment Per
Customer…...

$2,500

$3,140

$2,620

$10,500

$14,100

$13,470

What is total investment in Electric system?

Generation = $
7,500/Customer

Transmission = $1,500/Customer

Distribution =
$3,500/Customer

TOTAL INVESTMENT =
$12,500 PER CUSTOMER

Or $1,750,000,000,000 !!!

Total Generation Capacity in USA
–

900,000 MW

Average Generation Needed in USA
–

450,000
MW (50% Load Factor)



Typical Daily Residential Usage
-

Summer



2

3

3.5

3.7

4.1

4.5

4.8

5.2

5.3

5.8

6.2

5.7

5.7

5

4.7

3.7

3

2

0
1
2
3
4
5
6
7
Midnig…
7:00 AM
8:00 AM
9:00 AM
10:00…
11:00…
Noon
1:00 PM
2:00 PM
3:00 PM
4:00 PM
5:00 PM
6:00 PM
7:00 PM
8:00 PM
9:00 PM
10:00…
11:00…
KW Demand

Residential Usage 24 Hours

Base Generation

@ 2 cents/KWH

Intermediate Generation

@ 5 cents/KWH

Peak Generation

@ 10 cents/KWH

Cost of New Generation?

3000

4000

2500

11000

1785

0
5000
10000
15000
Coal
Nuclear
Hydro
Wind/Solar
Smart Grid**
Dollars per KW of New Generation

Approximate New Generation Cost by Type

Cost per KW
Why aren’t Electric Utilities with me on this?

1.
They don’t have any regulatory incentive to do real
SmartGrid

–

they get a return for a new coal plant, they
don’t get a return for technologies that avoid a new coal
plant
-

We must change politics of regulation

2.
They don’t believe you need big data requirements to do
SmartGrid

–

We must show them they are shortsighted
–

Ask Chattanooga

3.
They don’t want to be in the retail telecom business and
they don’t want to partner with anybody
–

We must
convince them that cyber security and common
infrastructure aren’t mutually exclusive