Telecommunications and utility company mergers on the not-too-distant smart grid horizon
SUBNET Solutions Inc | Thursday, April 28, 2011
In Indiana, Hancock Telecom and Central Indiana power recently completed a merger that many experts are pointing to as the first of many involving the future of the smart grid.
During the last year, many experts had predicted this trend, as the conjoined companies could improve efficiency within smart grid deployment and related operations.
The owners of the two Indiana companies, friends since childhood, realized that both of their businesses needed fiber deployment in the same area, which led to prolonged conversions about the merger.
"Everything we were seeing was that broadband power line was not working," said Mike Burrow, who came from the telco side of the business. "We realized the electric utilities would be deploying fiber, and they probably wouldn’t deploy it just for the smart grid. If they were going to go to that expense, it would be inevitable that at some level they would compete against us."
The merger was beneficial for the telecom, as it neutralized a potential competitor and now has a lengthier reach for new customers. Before the merger could be completed, however, state legislators needed to pass a bill that allowed for the combination. When the legislators realized the merger would save money for customers of both companies, the bill passed easily.
The new company, NineStar Connect, now plans to install smart meters for many of its customers and to connect them via fiber. These meters would support meter readings and collect data every 15 minutes. NineStar also hopes to interconnect substations through fiber to address outages in faster speeds.
While this merger is just the first of its kind, the increased efficiency it experiences could soon change the entire energy sector's landscape.
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