State BPL Regulatory Issues to Get Action in 2006, Say Officials

Even with matters pending at the FCC, the regulatory focus for the BPL industry will turn increasingly to the states in 2006, said industry officials. “The states are going to have the most activity” this year, said Brett Kilbourne, regulatory dir. of the United Power Line Council (UPLC). FCC action is awaited on petitions for reconsideration of its BPL rules as well as a plea by the UPLC to classify BPL as an information service on the lines of DSL and cable modem. Industry officials said they are also following efforts in Congress to rewrite the Telecom Act.

In the states, action is expected on issues such as affiliate transactions, rights of way (ROW) and cost recovery, said Kilbourne. But not every state needs to start a “proceeding” for power utilities to be able to roll out BPL, he added. States generally seem eager to get utilities to offer BPL, he said, “so I don’t think you will see protracted proceedings.” State issues also are different for different types of utilities. For instance, municipal utilities and cooperatives don’t face affiliate transaction issues, he said, but they may have to deal with ROW.

Industry anticipates that states wanting to spur BPL rollouts will follow Tex.’s example. The BPL provisions in SB-5 passed last year were cheered by the industry as a model states can use to speed deployments (CD Aug 15 p6). It removes BPL from municipalities’ ambit, specifically denying them jurisdiction over rates, operations or services related to BPL system construction, maintenance or operation. The law also bars municipalities from imposing easement or ROW obligations on BPL beyond what utilities already pay for electric purposes. Kilbourne said the Tex. law was a “step in the right direction,” but he wasn’t sure if that alone was enough for utilities to embrace BPL in large numbers. Cal. also has started a rulemaking to ease utility rollout of BPL (CD Sept 12 p2).

Granting UPLC’s request for a “declaratory ruling” to classify BPL as an information service will be a “pretty easy answer” for the FCC, said Kilbourne. “It’s a no- brainer. That’s what they are gong to rule,” agreed Richard Keck, gen. counsel for the Broadband over Power Line Industry Assn. (BPLIA). He said he didn’t see any controversy arising over the FCC ruling in BPL’s favor. But an industry lawyer said it’s unlikely the FCC will grant UPLC’s petition because “it is exactly the wrong time historically to raise that issue.” Congress is grappling with the issue, he said, and it’s doubtful the Commission will “tamper with the existing classification while Congress is considering the same set of questions. So if I were at the FCC, I would not want to set precedent knowing Congress would come along a month later and overturn it for me.”

Keck said BPL wholesale services that include VoIP probably will be considered telecom service. When BPL carries signals between its central office and end users for a VoIP provider it’s telecom service, he said: “And it’s not necessarily a bad thing.” That’s because if everything over a power line turns out to be something other than telecom or cable, then under current laws “you don’t have the right to get a franchise, an easement or get subsidized or [have the] regulated right to attach to utility poles,” he said. So this issue will play out in the states, said Keck: “That’s one of the topics that is going to be at least quietly worked out in the various networks around the country.” Besides attaching to their own poles, power utilities also use telephone company poles, he said. And under current pole attachment agreements with telephone companies, utilities are allowed to attach only for electric utility purposes, he added: “So if you have to put some equipment up there that is going to support a BPL network and is going to compete with a phone companies’ DSL network, I could see the phone company objecting.” The phone company can argue that the rights to pole attachment under the Telecom Act is only for telecom or cable service, Keck said, and unless BPL fits into one of those categories it’s going to be difficult for utilities to gain access to poles at regulated rates.

Under current law, states have no role in BPL regulation, said Michael Lazarus, attorney for Current Technologies. BPL is simply a pipeline like DSL and fiber, he said, and the “channel is subject only to federal regulation.” The states do traditionally regulate some of the services that may be offered over BPL such as telephone and cable services. “If those services are offered over BPL, the states and localities would be locked out.” He said he didn’t expect states to accept that status quietly, but “the law as it stands today does not give the states any role in BPL.” State regulatory framework wouldn’t become clear until there were some “serious” commercial BPL deployments and “you get the regulatory reaction to those deployments,” said Keck. Until then, he said, it’s just going to be “theoretical.”

Lazarus said most of the pending petitions for reconsideration at the FCC are frivolous, but about 6 are “reasonably serious.” None threaten the “current form” of BPL, he said: “Nothing important is going to change as a result of this.” The ARRL and ARINC have complained that the FCC hasn’t paid adequate attention to interference issues raised in the BPL proceedings, he said. For its part, the BPL industry wants to disclose less information than required by the FCC for the public database and also wants deadlines for having BPL equipment certified by the Commission pushed off. Another issue is a request by the American Petroleum Institute that the FCC extend the rules requiring advance consultation by BPL operators with public safety groups to providers of critical infrastructure facilities such as petroleum pipelines, Lazarus said. But the request is unlikely to pass, he said.

UPLC’s Kilbourne said BPL standard setting is expected to make “significant progress” this year. Kilbourne, who heads the IEEE’s BPL Study Group, said meetings are scheduled in Las Vegas this month for various standards subgroups: Hardware and Installation group (Jan. 10); EMC Interference Issues (Jan 11); MAC-5 Interoperability (Jan. 12-13). Because the study group was informal, a decision will soon be made to convert it into a “Standards Coordinating Committee,” he said.