The electricity industry is fighting for more access to increasingly valuable airwaves that it needs to keep the lights on and run and recharge the increasing amount of devices and tech toys tied to the Internet.
The industry has renewed its 20-year battle for the government to recognize its need for equal access to the radio frequency bandwidth in the electromagnetic spectrum, as energy management requires more machine-to-machine communication between customers and electricity providers.
For example, power grid operators need to be able to communicate with rooftop solar arrays to send signals on whether to increase output or curtail it, based on supply and demand changes.
Because generation is shifting away from central power stations, such as coal plants, and toward more distributed resources, communications will be key to managing the grid of the not-too-distant future, according to experts.
The gates to the spectrum have been tightly guarded by the Federal Communications Commission, which for the most part has given big telecom carriers such as AT&T and Verizon priority when it sells new lines of frequency to the highest bidder.
The utility industry says that needs to change. The FCC must think about ways to help utilities meet their needs for spectrum, especially as new Internet technologies are added to the grid. The industry says it was a conversation that Congress meant to occur when it passed the telecom reform bill in 1997, kicking off the wireless revolution. But the FCC never followed through.
“What’s happened in the intervening 10 years or so is that the needs have only increased for spectrum,” said Joy Ditto, president and CEO of the Utilities Technology Council, the electricity industry’s key trade group for their communications concerns.
Those changes are summed up partly as “the shift toward ‘Utility 2.0,’ or whatever you want to call the utility of the future,” Ditto said.
The industry will need more spectrum as it moves toward a more “distributed grid” focused on solar panels, energy storage, and electric vehicles, which will require more two-way communication between customers and utilities.
When Congress passed major telecommunications reforms in the mid-1990s, the utilities were cut out of the conversation on dedicated spectrum, where the phone giants dominate, experts say.
“The fact that utilities aren’t allocated this spectrum seems almost irresponsible in this day and age,” said Richelle Elberg, principal energy analyst with the consulting firm Navigant.
“Some utilities are evaluating private spectrum options, but because of the way the FCC auctions off spectrum, and the billions and billions of dollars that raises for the Treasury, and the carriers, which have a much more compelling and immediate business case for that spectrum, they have driven the prices up so high that a lot of utilities simply can’t afford to buy spectrum,” Elberg said.
“But as a result of all of these dynamics, utilities have tended, up until now, to use solutions based in unlicensed spectrum bands,” she said. But that won’t be enough to handle the projected 20 billion to 100 billion Internet-connected devices expected to explode onto the market in the next decade.
Referred to as the “Internet of Things,” more Internet-connected devices will require utilities to interact seamlessly with devices such as smart electricity meters, Internet-connected residential boilers, more rooftop solar panels, appliances that can talk to the grid to curtail energy use, big battery storage and more electric cars. And don’t forget giant, 24-hour a-day manufacturing plants with new grid-enabled technology.
All of that will put a strain on utilities’ communications hardware, and the unlicensed spectrum that utilities rely on “is going to be clogged up,” Elberg says.
Scott Sklar, an energy consultant for businesses and the military, says he can see the arguments for and against the utilities’ need for spectrum.
“As you’re moving to a smarter grid … for cybersecurity and other issues, you probably want to reserve spectrum,” Sklar said. “Now, whether they need to have that themselves or they can access through other entities, of course, is a very big question. And I could actually argue it either way.”
He sees utilities eventually morphing into something resembling a telecom company that also provides energy because of the growing need for spectrum and reliance on telecommunications as part of the grid.
“We started with electric utilities on one side and gas utilities on the other side. Now we have a lot that are both,” Sklar said. “We have some utilities around the country that own cable subsidiaries and some even telephone subsidiaries.
“So, the utilities of the future are potentially blended service options,” which may be more economically viable, he said.
Utility profits have remained flat in recent years, which could force them to take on other services, he says. But they will have to find what works best for them by building out their own private networks or leveraging the assets of the telecom industry — the Verizons and AT&Ts — and other companies to help meet their needs.
In the past, electric utilities argued that telecom companies cannot provide the level of reliability to meet their needs, which has driven the argument that the FCC needs to address their concerns.
Ditto’s group says Congress and the White House must get involved. The organization has started an aggressive campaign to lobby and educate lawmakers on steps they can take to address the issue as part of the infrastructure debate.
One of the answers is for Congress to mandate that the FCC talk to the Federal Energy Regulatory Commission, the nation’s top electric grid regulator, the group says.
“With the FCC overseeing a central element to the reliability of our nation’s electricity system, Congress should direct the FCC and FERC to meet on a regular basis to discuss issues of shared interest and jurisdiction,” Ditto wrote in a letter to the House Energy and Commerce Committee at the end of February. She wants the two agencies to create a “joint spectrum team” that would include one commissioner and staff from both FCC and FERC.
The group also wants Congress to pass a nonbinding resolution that recognizes the “spectrum needs of the energy industry.” The resolution would send “a strong signal to government agencies about how critical spectrum is to our nation’s electricity future,” Ditto wrote.
Lawmakers are delving into spectrum issues as they look for ways to help rural communities expand access to broadband. The industry says those lawmakers also are looking into new sources of spectrum for utilities.
A congressional agreement hashed out last month would look to make more spectrum available to usher in the next era of 5G wireless service. The House passed its version of the bill last month after the Senate passed its version last year. It isn’t the same thing as making spectrum policy for utilities, but it could offer an opening.
But given the lack of certainty in Congress, the industry group is also seeking help from the Trump administration and agencies such as FERC and the departments of Energy and Homeland Security.
Ditto said she and her staff have met with the White House twice in the last six months and are getting ready for a third meeting in the spring. The first two meetings were with energy and telecom advisers. The group is expected to meet with White House security advisers soon, Ditto said.
Guarding against cyberattacks pairs nicely with utilities’ spectrum needs and is an area that the industry can use to help push greater telecom and energy collaboration, according to experts.
The group next month will hold its Telecom & Technology Conference in Palm Springs, Calif., where Republican FERC Commissioner Neil Chatterjee will provide a keynote address. Chatterjee served as chairman before Kevin McIntyre took over the helm. Both were appointed by President Trump.
