Carrier Channel: Electric Utilities Power Up

Posted: 5/2003

Electric Utilities Power Up
Wholesale Wi-Fi Networks

By Khali Henderson

trying to solve the problem of getting subscribers to its fiber assets,
electricity giant American Electric Power — along with technology partners
Cisco Systems Inc. and RedLeaf Group Inc. — stumbled upon a delivery mechanism
for high-speed wireless access or Wi-Fi. That solution lay in the medium voltage
power grid.

"The medium voltage grid runs
down every street where there is electricity delivered," explains Jeff
Tolnar, vice president of marketing and business development for Amperion Inc.,
the joint venture between AEP, Cisco and RedLeaf. "So whether it’s a
business or a residence, you have a medium voltage grid within a few hundred
feet of that building or house."

The grid also passes around and near
fiber assets that are already in place. "Assuming that we could develop a
broadband product that could enable broadband delivery over that grid, then we
have a perfect place for on and off ramps to our fiber asset," Tolnar says,
recalling the thought process.

Amperion’s studies proved its
theory, but there was not existing technology in place. Other powerline
communications (PLC) vendors were working on in-home/on-premise or low-voltage

"What we had to do was find a
way to get on the medium voltage grid in a safe and reliable manner," says
Tolnar, who notes the grid carries a lethal current of up to 34,000 volts.

What Amperion discovered was Wi-Fi
offered a means to get safely and reliably on and off the grid — and that it
offered a way to get into the customer premise. "Initially we were just
going to use it to bypass the transformer, but then we discovered that the
customers were well within the reach of WiFi as its specified today,"
Tolnar says, "So, the WiFi approach that we put into place for safety and
reliability now we use to be able to get to the end user customer in really
effective and cost-effective manner."

In other words, customers —
business and residential — can buy Wi-Fi gear off the shelf. "You have got
wonderful scales of economy in the thousands of engineers that are working every
day to improve [Wi-Fi’s] reach, to improve its security and performance. That’s
something we could never duplicate in a small company like Amperion," he

"So, we are able to get the
scales that the Wi-Fi industry is driving and then we can provide backhaul that
the Wi-Fi industry desires and is challenged by," Tolnar says, noting that
the backbone speeds range from 15mbps to 24mbps. "So, you no longer have to
pull backhaul into every wireless access point that a WISP would put into a
neighborhood or a business park or a Starbucks. Power line is that

The production-grade solution, the
Amperion Connect system and PowerWiFi access, was unveiled in late February.

Here’s how it works (see diagram
below): An "injector" is placed at the Internet PoP or substation. The
injector takes the wireless signal from the PoP and converts it into a power
line signal and sends it up and down the medium voltage feeder. The power line
sends the signal approximately 2,000 feet at which point a "repeater"
is placed to repeat the signal or an "extractor," or wireless access
point, extracts the signal. Amperion says it can deploy a network for $50 to
$150 per home or building passed depending on the density of the customer base
and the reach.

Click Here For Diagram

"As you start to place these
units every 1,000 or 2,000 feet, all of a sudden, you start to have complete
wireless coverage using standard 802.11b," Tolnar says.

While utilities could perform
functions throughout the value chain, they are likely to become wholesale
providers of the PLC service, working with third-parties, such as integrators to
place the premise equipment, traditional network operators for the IP access and
network management and ISPs that interface with the customer.

"We will see a mix of
deployments where the utility will buy, own and operate the Amperion Connect
network and we’ll also see opportunities where the utility will just lease the
wires to some type of service provider — whether that’s a carrier or an
ISP," Tolnar says. "We are seeing both unfold right now."

He says Amperion is in the midst of
three trials — one with AEP that is a technology trial, another with PPL
Electric Utilities in Pennsylvania, a subsidiary of PPL Corp., and another with
an unnamed investor-owned utility.

Cisco Systems Inc.

RedLeaf Group Inc.

American Electric Power

PPL Corporation

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