Supply chain challenges that have impacted the ability of electric cooperatives to maintain and expand their grid systems over the past two years are finding their way into the operations of co-ops working to close the digital divide. Now, as tens of billions of dollars in federal and state broadband funding comes online, the nation’s supply co-ops are taking unprecedented steps to expand their inventories of critical communications hardware.
“When government money is available, that perks up everybody’s interest,” says Dan Bell, an outside sales representative for General Pacific Inc., a Fairview, Oregon-based member-owned logistics and supply cooperative serving co-ops and public utilities in the Pacific Northwest.
Bell says customer interest in broadband began to ramp up around 2007 and grew steadily with the rise of online commerce and advances in entertainment and gaming. But as telework and remote schooling took hold amid the COVID-19 pandemic, the pace skyrocketed.
“A lot of utilities are jumping into it with both feet,” says Josh McIntosh, GenPac’s manager of contractor sales.
GenPac is one of nine members of the Electric Utility Distributors Association, or EUDA Group, a network of vendor services providers committed to meeting the equipment needs of electric co-ops, municipal utilities and public power districts.
The growing demand for broadband and digital communications components have driven EUDA members to rapidly expand their inventories and add new product lines to ensure that co-ops now developing broadband networks have the parts and equipment they need.
“Fiber components are seeing long lead times, up to a year, due to the high demand,” says Phil Clark, vice president of sales and operations for United Utility Supply Cooperative. “The material went from being readily available to high demand and long lead times due to federal funding, fiber-to-home, global supply chain dependence and more rural development.”
Louisville, Kentucky-based UUS is run by Kentucky Electric Cooperatives. Clark says that field representatives and sales staff are spending a lot of time listening to co-op leaders and tailoring logistics plans to meet their needs.
“When you have a co-op that is changing out poles for a broadband buildout, that adds to the existing high demand for all other co-op construction,” says Clark. “That’s a lot of crossarms; nuts; bolts; wood poles; everything that goes on the pole. And there are only so many manufacturers.”
Interest in broadband has prompted EUDA members to establish ties with more vendors, particularly as state and federal funding programs balloon.
“Last year, we spent a considerable amount of time reviewing comparable products to give our members more choices with shorter lead times,” says DaWayne Hardy, director of fiber solutions at GRESCO, a Forsyth, Georgia-based supply co-op that serves co-ops in several southeastern states.
“Projects that were on a steady pace to complete in three to four years often get ramped up for completion in a significantly reduced timeframe,” he says. “This puts a strain on the supply chain when the original plan for material was over a longer amount of time, but it’s great for the communities to get broadband access faster than originally anticipated.”
To meet that accelerated demand, GRESCO dedicates more warehouse and yard space to broadband materials, Hardy says.
“We’re trying to squeeze every inch of space possible to add more stocking capacity.”
Many supply groups are seeing unusual demand for products and services as electric co-op venture outside their electric service territory to bring broadband to underserved residents.
“We have seen a number of our member co-ops step up and fill an urgent need for broadband in their communities,” says Matt Brandrup, CEO of Madison, Wisconsin-based RESCO, which serves more than 200 co-ops in the upper Midwest. “We are seeing some members expanding to off-system builds, because neighboring communities are requesting them to provide broadband in their community."