November 30, 2018

Utility Communications and How the FCC Decisions Impact the Industry

Joy Ditto

This aricle is jointly published by the Renewable, Alternative, and Distributed Energy Resources Committee and the Energy Infrastructure, Siting, and Reliability Committee. 

Much of the electricity industry’s attention on regulatory matters, rightfully, is focused on the Federal Energy Regulatory Commission (FERC). However, as I recently said in testimony to a Senate Energy and Natural Resources Committee hearing on black-start resources in October 2018 (Statement of Joy Ditto before Senate Energy and Natural Resources Committee Oct. 11, 2018), practitioners may be surprised to find out that some of the most impactful regulatory decisions affecting the industry are coming not from FERC but from the Federal Communications Commission (FCC). 

How so? Most utilities—electric, water, and natural gas—build, own, and maintain their own communications networks to underpin the reliable delivery of utility services (see Invisible Infrastructure: How Utility Telecommunications Networks Underpin the Grid  (https://utc.org/wp-content/uploads/2018/10/About-Utility-Comms-101.pdf]). In order for the wireless aspects of these networks to function, utilities must gain access to radio-frequency spectrum, a naturally occurring phenomenon the access to which is controlled by the FCC. Unfortunately, the FCC has not well understood the needs of utilities or other critical infrastructure industries in its policymaking, which we will review below.

First, some background. (For this article, we will focus primarily on electric utilities, although these issues also impact networks owned and operated by water and natural gas utilities.) Electric utilities use their private communications networks—also called “information and communications technology” (ICT) networks—for a host of essential services, including service restoration and storm response, managing day-to-day reliability, and enabling the granularity required to balance the electric grid as distributed energy resources and intermittent forms of generation are deployed.

As the nation has seen in response to two devastating storms—Hurricanes Florence and Michael—electric utilities rely on their communications networks to restore service. By creating high levels of redundancy (back generation, backup fuel on-site, and battery backup) in their own communications networks, utilities ensure their networks can function even when the power grid is out, allowing workers to restore service as quickly and safely as possible. Spectrum is needed to enable these communications. As may be obvious, communications networks require power to function; hence the need for generation redundancy delineated above.

In addition to emergency response for “grey sky” events such as localized/regionalized storms, utilities use their networks for “blue sky” operations, “black sky” events, and the integration of distributed energy resources (DERs), smart meters, and other customer-facing technologies, often known as “utility 2.0” (https://utc.org/wp-content/uploads/2018/10/Definitions_Final-Version_October-2018.pdf).

Blue sky operations refer to the day-to-day reliable operation of a utility’s infrastructure. This generally means moderate temperatures resulting in manageable load (demand) expectations, with no weather, cyber, or physical incidents or emergencies. Even when temperatures are moderate and load requirements are easily met, utility networks are essential to the reliable operation of the grid given the use of industrial control systems like supervisory control and data acquisition (SCADA) that operate over a utility’s network, as well as digital components like sensors that help to analyze the health of the transmission and distribution assets on the grid by sending data back to utility engineers.

Black sky operation refers to catastrophic events compromising electric reliability and the country’s collective effort to respond and restore service, possibly resulting in long-term power disruptions. The reasons for such an event could be from a devastating natural disaster, cyber-attack , physical attack, act of war, or a combination of incidences. The resulting impact could mean a utility is unable to restore service safely for numerous reasons, including the failure of utility ICT networks, or is unable to do so in a reasonable time frame.

Finally, utility networks support the onset of edge-of-the-grid technologies. Distributed energy resources, smart meters, battery storage, intermittent resources, and many Industrial Internet of Things applications cannot be fully integrated into grid operations and optimized for both the customers and the utilities without ICT networks. Without such communications, the instantaneous balancing of the power grid (i.e., supply and demand must always match up) that must occur through proper grid management would be inadequate with the amount of devices and variability of the devices interfacing with the future grid.

Here’s where the FCC comes in. All the network components described above rely to some extent on wireless communications. Like any wireless network, utilities need radio-frequency spectrum to function, and the reliability of the wireless communications can be affected by radio-frequency interference. Because electricity is generated and consumed instantaneously, the electric grid requires a delicate balance between supply and demand. This means utility networks must transmit data at high speeds to avoid power disruption. Interference can displace and disrupt signals, potentially disabling the ability of a critical wireless transmission to reach its destination. Therefore, access to adequate and interference-free spectrum is required if these networks are to work as intended.

The FCC manages spectrum policy under the Communications Act of 1934, which requires the FCC to manage spectrum in the public interest. In the Balanced Budget Act of 1997, Congress authorized the FCC to award spectrum through auction, although it also exempted utilities from competitive bidding of spectrum, given the importance of utility services to the country. Despite this congressional requirement, the FCC has largely treated utilities the same as any other commercial entity when it comes to spectrum acquisition. As a result, utilities often find themselves unable to compete with other enterprises for interference-free spectrum. Spectrum is one of the key resources that enable private utility ICT networks, which also means spectrum is essential to the reliability of our nation’s Bulk Electric System.

FERC requires electric utilities to meet stringent standards in order to provide the highest levels of reliable service. Integral to the industry’s compliance is access to interference-free spectrum. Without this, private utility networks will not be as reliable and resilient as they are now. Yet, the FCC has pending proceedings that threaten the reliability of utility networks. One proceeding the FCC launched in October 2018 would expand access to the 6 GHz spectrum band to unlicensed users. Many utilities and other critical infrastructure industries use the 6 GHz band for mission-critical communications. Our concern, based on experience, is that letting new commercial users into the band will cause interference to utility mission-critical networks.

Interference occurs when the transmittal or reception of a wireless communication is blocked, temporarily disabled, or diminished. Utility communications networks in the 6 GHz band support essential functions such as SCADA systems used to monitor and control substations and valves as well as security and transfer-trip protection circuits that guard against external threats and isolate faults on the grid. Any interference on these networks could threaten the reliability of SCADA and other automated systems.

If the FCC expands access into the 6 GHz band, utilities will face a Hobson’s choice: they will either have to relocate their communications networks into another band or remain in the 6 GHz band and hope the redundancy already built into their infrastructure will prevent failure. Unfortunately, there appear to be few, if any, other suitable spectrum bands that meet utilities’ needs, meaning relocating may not even be an option.

A few more proceedings at the FCC deal with attaching telecommunications infrastructure—wireless and wire line—to utility-owned poles. In these so-called pole-attachment proceedings, the FCC has established rules and procedures aimed at expediting the deployment of broadband and small-cellular devices across the country. These procedures govern the rates pole owners—often utilities—can charge for providing access to their poles and the speed in which they determine whether new attachments can be safely added to a particular pole. In theory, the FCC devised policies with the premise that faster and cheaper access to poles will result in greater broadband deployment, including in rural areas. In practice, however, this has not been the case. The FCC’s own reports indicate that high-speed broadband services remain unavailable to many in rural America (FCC’s February 2018 Broadband Deployment Report).

We have concerns that the FCC is putting lower rates and speed ahead of public safety. Each of these attachments carries weight—and some wireless devices can weigh as much as a small refrigerator (Statement of Shireen Santosham, San Jose Mayor’s Office, before the House Energy and Commerce Committee, November 2017). With the FCC recently passing new rules to expedite the placement of small-cellular devices (September 2018 Accelerating Wireless Broadband Deployment by Removing Barriers to Infrastructure Investment), many utilities believe the agency does not understand or value the critical services utilities provide. This is ironic given that commercial telecommunications networks cannot function without electricity.

These are just a few examples why we believe FERC and the FCC need to hold cross-agency discussions about the growing interdependencies between the energy and telecommunications industries. Such meetings would build understanding between the two agencies and the industries they regulate. These discussions would inform policymakers as they move forward on infrastructure, cyber security, resilience, supply chain, and wireless policies that impact both sectors.

Utilities Technology Council has been active in Congress, FERC, the FCC, and even the Department of Energy in calling for these agencies to meet. This message resonated when I testified in October before the Senate Energy and Natural Resources Committee; indeed, several senators from both parties asked questions and seemed supportive of the need to break down silos between these agencies. We are optimistic this momentum will carry forward and bring about a needed discussion about the interdependencies between these critical industries.

Joy Ditto

Published: November 30, 2018

Joy Ditto is President and CEO of Utilities Technology Council.