The electric power system is undergoing profound changes to improve grid reliability, operational efficiencies, customer service, environmental compliance and energy conservation.

To make this transformation, electric cooperatives must harness new technologies that depend on sensors, data and analytics that require the advanced communications capability of a broadband backbone.

Who stands to benefit from such an investment by an electric co-op?

The answer, says NRECA's chief economist in the Business & Technology Strategies department, is simple: Everyone—the consumer members, the distribution cooperatives and even the G&Ts.

Russell Tucker explored the topic in-depth in a recent benefit assessment, The Value of a Broadband Backbone for America's Electric Cooperatives, a joint NRECA and NRTC effort. In an interview, he discussed the challenges for co-ops building a broadband backbone and the resulting value for their members.

What exactly is a broadband backbone?

Tucker: It's a communications system with high bandwidth to transport data critical to an electric cooperative's operations. It's advanced electric utility infrastructure that enables a cooperative to maximize value from its smart grid.

More specifically, it is a high-capacity, low-latency communications network that connects systemically important infrastructure used in electric operations and transports data collected by other utility networks, which is critical to managing electric operations. All are also enabled by interoperability through MultiSpeak®.

A broadband backbone can be all fiber, it can be wireless, or it can be a hybrid of both technologies. Fiber is more expensive than wireless but can provide much more flexibility as co-ops innovate and invest in new technologies for the grid of the future.

Many co-ops are continuing to enhance their grids. How does a broadband backbone play into these advancements?

Tucker: AMI—advanced metering infrastructure—allows two-way communication with consumer-members and provides the meter data that makes the grid smart. Those data are required to optimize grid operations, including outage management, power quality, voltage, consumer-member DER product deployment, all with an eye toward optimization. The broadband backbone transports all the data required for analytics and the resulting signals required to optimize grid operations and to respond to these communications.

AMI is central to the smart grid—and co-ops lead the electric industry in AMI adoption, accounting for 60 percent of co-op meters. High-speed, low-latency data transport and data interoperability are key enablers of identifying value.

Can you give an example of when grid optimizing and communication response come into play? How does this work in everyday life?

Tucker: Today, interest in distributed energy resources (DER) deployment, including behind-the-meter generation and energy storage, is growing among co-op consumer-members. To successfully add these resources, the grid must manage two-way power flows through two-way communications.

In the foreseeable future, take the charging of electric vehicles, for example. Special care needs to be given by co-ops for scheduling EV charging to manage demand and keep costs affordable. A broadband backbone provides the necessary communications to support co-op investments to adapt and respond to these grid applications.

How does a broadband backbone facilitate other everyday activities that impact the grid?

Tucker: There are a number of advanced grid applications—referred to as "use cases" in the report—that can be applied to the distribution grid, such as volt/var optimization, substation automation and demand management.

While a broadband backbone may not be needed to execute a single use case, implementing multiple use cases requires broadband communications to transport increasing amounts of critical data.

For example, there is a lot of interest in streaming video for security and other purposes. That requires a lot of bandwidth that can be delivered through a broadband backbone.

These emerging grid applications can require up to 100,000 times more data than traditional grid operations. Having a broadband backbone enables these applications.

And what about physical utility equipment?

Tucker: There are many examples of how a broadband backbone can help protect a co-op's equipment and better manage equipment use in the field. Here's one: Electrical transformers are extremely expensive. A co-op can monitor loading on transformers to help predict maintenance events.

A co-op with a substation near floodplains or in the path of a hurricane also can manage that asset remotely with two-way communications allowed through a broadband backbone. With livestream video, co-op engineers can see water levels rise and switch off the substation's operations to protect it and switch it on after the threat dissipates.

In these ways, a broadband backbone can enable and enhance asset management.

How does a broadband backbone improve service to co-op members?

Tucker: Grid optimization is all about improving performance and reducing costs and enabling DER—areas of great interest to consumer-members.

One distribution automation application, FLISR (fault location, isolation and supply restoration), enabled through broadband communications, allows co-ops to precisely pinpoint the location and extent of an outage and send repair crews in real-time, which speeds up outage restoration to consumer-members. The technology can further analyze the situation and automatically reroute electricity to minimize service disruption costs for members. For critical loads, DER can be strategically placed to help with this event management and mitigation.

What other opportunities are possible for co-ops with a broadband backbone?

Tucker: That depends on the extent to which a co-op wants to accommodate use cases of the future. If a co-op chooses to construct a fiber backbone system, there may be an opportunity to lease spare or dark fiber to others to support the development of a retail broadband service. New revenue can be generated by leasing unused communications capacity, such as dark fiber or other sources, to enterprises.

In terms of dollars and cents, how can building and operating a broadband backbone benefit electric co-ops?

Tucker: A broadband backbone can save co-ops money by avoiding significant costs when combined with distribution optimization technologies.

The study estimates annual economic gains (before investment costs) of $1.7 million to $2.9 million for a 10,000-member electric co-op and as much as $10 million to $16.6 million for a 50,000-member co-op. Importantly, gains are projected to increase over time as more use cases are applied to the grid.