PowerLine - September 18, 2007

FERC: REPORT SHOWS SIGNIFICANT INCREASE IN DEMAND RESPONSE AND AMI

This month, FERC released its second annual report on demand response, which found that demand response and advanced metering programs have grown significantly since it published its last report in August 2006. Interestingly, the report lists BPL deployments at TXU (2 million meters), CenterPoint (1.9 million meters) and ConEd (500,000 meters) among the 43 utility AMI projects, representing roughly 10% of the total 40 million advanced meters that will be deployed between 2007 and 2010. That is almost a threefold increase from 2005 to 2006, and it is projected to double again by 2008. The report also cites several state AMI proceedings and bills in California, Connecticut, DC, Maryland, Ohio, Pennsylvania, Texas and Vermont that helped contribute to the increase in AMI during the year. The full report is available on the UPLC Web site here.
For more information, contact the UPLC Legal/Regulatory Department.

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CANADA: ONTARIO UTILITIES AHEAD OF THE CURVE TO MEET SMART METER MANDATES

According to Metering.Com, four different AMI technologies are being deployed in Ontario for a grand total of 1.16 million smart meters by the end of the year. A large majority of these smart meters are mesh network-based for enhanced interoperability. Utility companies involved in the roll out include Chatham-Kent Hydro, Enersource Hydro, Horizon Utilities, Hydro One Brampton, Hydro One Networks, Hydro Ottawa, Middlesex Power, Milton Hydro, Newmarket Hydro, PowerStream, Tay Hydro, Toronto Hydro and Veridian Connections. Of these, Toronto Hydro plans for the biggest network with 400,000 meters to be installed. The large deployment is part of the Ontario Smart Metering Initiative which requires smart metering in Ontario by 2010. At this rate, the smart meter deployment initiative is well ahead of schedule.

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FCC: JUSTICE DEPARTMENT OPPOSES NET NEUTRALITY

The Department of Justice (DOJ) formally opposed net neutrality in a written ex parte filed this month in the FCC’s net neutrality inquiry proceeding. The DOJ explained that net neutrality rules could have the counterproductive effect of impeding competition by blocking service providers from offering premium services and prioritizing "latency-sensitive content" such as streaming video. Moreover, the DOJ concluded that there was no need to institute any preemptive net neutrality requirements at the outset. Instead, the DOJ recommended that regulators watch out for anti-competitive activity and bring enforcement action in those cases. According to the DOJ, the broadband market is competitive and there has been virtually no evidence that broadband providers are blocking the traffic of their competitors. Finally, the DOJ noted that the concept of net neutrality is still undefined and amorphous, which could lead to regulatory creep. DOJ said it will watch for potentially anticompetitive conduct in Internet services and bring enforcement action when necessary. For more information on the DOJ filing, contact the UPLC Legal/Regulatory Department.

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INTERNATIONAL: NATO SENDS NEGATIVE SIGNAL ABOUT
BPL INTERFERENCE POTENTIAL

NATO published a report on the interference potential of BPL, as well as DSL services, that concludes that their RF emissions could "adversely affect" military radio and intelligence communications in NATO countries. NATO conceded that "[e]xact calculations of HF radio noise emissions from the new broadband wire-line telecommunications networks were impossible," and the results of its models were "highly influenced by assumptions on transmitter EIRP, PLT market penetration, and duty cycle." The report also sets a very low level for protecting sensitive military operations (–15 dBµV/m (9 kHz bandwidth) across the entire ES - 2 RTO-TR-IST-050 HF range. Although NATO "by itself, has no regulatory authority over the emission limits," it promised to "seek the implementation of [commonly accepted emission limits] by working together with the national and international regulatory authorities." UPLC is concerned that NATO's report is misplaced and could lead other countries to adopt emission limits that could discourage the deployment of BPL. For more information, contact the UPLC Legal/Regulatory Department.

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INDUSTRY: UTILITY.NET'S MICHIGAN DEPLOYMENT TO PASS 20,000 HOMES THIS YEAR

Utility.net reported that it expects its network in Grand Ledge, Michigan will pass 20,000 customers by the end of this year. Specifically, the deployment will pass 5,000 customers in September, and utility.net plans to expand the deployment to another 5,000 customers in each of the next three months thereafter. Reportedly, Consumers Energy will review the deployment after it reaches 10,000 customers, at which time it will decide whether to approve the expansion to another 100,000 customers. Utility.net ultimately hopes to deploy BPL to 1 million customers in Consumers Energy’s service territory.

Reportedly, utility.net will use equipment from Kaicom on medium voltage lines, and it will either use Kaicom or Corinex on low voltage lines and in the customer premises. It also has adopted an "open access" business model, providing wholesale access to local ISPs. The ISPs will in turn provide retail services, probably in the range of $20-$60/month, depending on the speed of service.

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INDUSTRY: AMBIENT INCORPORATES CAPACITIVE COUPLING INTO
ITS PROPRIETARY NETWORK DESIGN

This month, Ambient Corporation announced that the FCC has approved the commercial deployment of Ambient's BPL systems with both Ambient inductive couplers, as well as, Arteche capacitive couplers on medium voltage electrical distribution lines. According to Ambient, this approval increases its flexibility in network design. "The FCC expansion of our equipment authorization allows us to utilize capacitive couplers where suitable in our overhead deployments," stated Ram Rao, CTO of Ambient Corporation. "Having an additional option in deploying our BPL communication platform demonstrates Ambient’s flexible system architecture and technical leadership in our industry." Ambient already has installed Arteche’s couplers in Ambient's largest deployment.

"Arteche believes in the future of the North American Access BPL market and we are pleased to have our couplers incorporated into Ambient’s FCC-certified network. As the North American utility infrastructure is in need of modernization, being a part of Ambient’s deployments at the beginning stages of smart grid adoption is a very exciting opportunity for Arteche," stated Lander Zugazaga, PLC Coupling Sales Manager at Arteche Group.

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INDUSTRY: PPL CLOSES SALE OF PPL TELCOM

PPL Corporation has announced the completion of the sale of PPL Telcom to Colorado-based Communications Infrastructure Investments. PPL estimated that the deal carries an enterprise value of $60 million, including the assumption of about $10 million of debt. PPL explained that it sold PPL Telcom because it was not part of the utility's core business. The new company will be called Zayo Bandwidth. The 4,000-mile fiber network provides wholesale carriers' carrier services between New York and Washington, D.C. It is not clear what impact the acquisition will have on the BPL deployment in Bethlehem, PA.

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INDUSTRY: UPLC AT HOMEPLUG TECHNOLOGY CONFERENCE

The UPLC will be speaking about "Laws and Regulations Affecting Broadband Over Powerline Deployments" during the HomePlug Technology Conference. During the presentation, Brett Kilbourne, Director of Regulatory Services and Associate Counsel of UPLC, will provide the latest developments with regard to the technical rules for BPL, as well as broadband and energy policies affecting the deployment of BPL systems. This year's HomePlug Technology Conference is an opportunity to be a part of HomePlug's growing industry and consumer support. The Conference will be held in Santa Clara, California on October 10-11, 2007. Anyone involved or interested in power outlet connectivity and the realization of the connected home, should attend this event. To learn more and to register, please visit 2007conference.homeplug.org for more information.

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About UPLC
The United Power Line Council (UPLC) is an alliance of electric utilities and technology companies working together to drive the development of broadband over power line (BPL) - broadband services over the existing distribution electrical grid and in-home electrical wiring -in a manner that helps utilities and their partners in North America. The UPLC's efforts are focused in three strategic areas: market awareness, regulatory and legislative advocacy, and technical operability. For more information about becoming a member, visit:www.uplc.org.

United Power Line Council,
1901 Pennsylvania Ave., NW, Fifth Floor, Washington, DC
20006.