Tennessee Utilities' Fiber Boosts Business Growth, Electric Reliability

Tennessee utilities are finding that building out fiber is not only providing new broadband options, but also making communities more attractive to new businesses and enhancing the reliability of the electric grid. 

  • EPB

As traditional providers fall short on delivering high-speed broadband in smaller towns, several of Tennessee’s electric utilities are stepping into the broadband game.

EPB, Bristol Tennessee Essential Services and CDE Lightband found their fiber networks are helping drive business growth and improve electric reliability.

When EPB devised its fiber plan it considered three main points: take rate, electric system impact and the impact to the Chattanooga community.

Since launching its fiber network in 2009, EPB surpassed its initial 30,000 customer mark. It now serves more than 117,000 customers.

Before EPB launched the service in 2009, EPB asked the chair of finance at the University of Tennessee at Chattanooga to build an economic model of how the fiber would affect the community. A new study by the university revealed that Chattanooga gained a $2.69 billion in community benefit during the first 10 years from the fiber network. 

“The university projected EPB would see $605 million return over the 10 years,” said David Wade, executive vice president and chief operating officer of EPB. “We just completed the study again and this time, the realized value brought more than $2.6 billion worth of value to Chattanooga.”

Bristol Tennessee Essential Services and CDE Lightband see similar benefits. Bristol Tennessee Essential Services currently serves 33,000 electric customers and 19,000 fiber customers. It has surpassed its plan to have 7,000 fiber customers. 

Mike Browder, CEO of Bristol Tennessee Essential Services, said the fiber network is attracting and retaining residents. “We had other things in our community that people like and want, but we needed something to keep our young people here,” Browder said.

Meanwhile, CDE Lightband gained a 32 percent take rate with more than 24,000 customers. The presence of fiber made it a new spot to host gaming conferences. “We have seen $66 million return on our fiber investment,” said Brian Taylor, general manager of CDE Lightband. “We host an annual gaming conference called F2Con, which we’re able to do because of our high-speed internet service.”

Enhancing Electric-Grid Reliability

Given that the utilities are in the electricity business, the fact that fiber networks improved electric-system reliability was an obvious benefit.

Fiber allows a utility to get information at any point along the electric cable. The technology can improve the monitoring of components of a substation or other high-powered infrastructure and provide immediate information on the health of a smart grid.

Like its broadband take rates, EPB has exceeded its electric-grid efficiencies. “We have seen a more than 50 percent improvement since we built our smart grid,” Wade said.

Similarly, CDE Lightband has seen annual operational savings. “The broadband division is paying the electric division $8 million per year in rental of the fiber and shared costs,” Taylor said.

Browder said the fiber network enables it to be proactive, which is key for business customers who rely on power to keep running. “The fiber network helps us provide on-time electric service,” he said. “Being able to read meters, report outages, automate switching and relocate a load without anybody having to touch anything has been huge.”

In one case, the network prevented an outage from impacting The Pinnacle shopping center in Bristol, Tennessee. “The person who built The Pinnacle told me it had not any outages since it opened,” Browder said. “I held up four fingers and told him, ‘you had four, but the longest one was 36 seconds.’”

Attracting Businesses

Building out a fiber network enables a city to attract new businesses and employees. For instance, Clarksville, Tennessee’s industrial development board touts fiber-based broadband as a core amenity. Large industry titans, including Google, have come into the broader county, and fiber is attracting residents who work at those companies. 

“While the large, industrial load has been out in the county we don’t serve, much of the residential load and their small partners are on our system,” Taylor said.

But Taylor added that fiber is not only about attracting large businesses. “We have a church that does virtual sessions that asked to be annexed into the city so it would have fiber-based internet,” he said. “Fiber has been a strong economic development tool.”

Likewise, Bristol Tennessee Essential Services attracted Agero, which offers roadside assistance and dispatch services to automakers, insurance companies and tow-truck providers. Initially, Agero did not want to locate a facility in Bristol, but it liked a particular building.

“Agero came back and looked at the building and saw that our fiber was connected to some sandwich machines,” Browder said. Bristol Tennessee Essential Services was able to connect the building with fiber in one day, which enabled Agero to improve internet-based phone calls.

“Agero’s president told us we’re the only ones that enable them to do internet phone calls without background noise,” Browder said.

Similarly, EPB attracted the International Maritime Security Associates. The Fort Lauderdale company takes thousands of data points and creates a location-specific set of information to send to ships at sea. “They said a big reason to locate in Chattanooga was EPB’s fiber service,” Wade said.

(This article will be included in Broadband Communities’ coverage feature of the FBA Fiber Connect event in the upcoming Jan/Feb edition.)

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