Innovative Nonprofit Announces Partners for Broadband Funding, Infrastructure Approach
There are often common characteristics among communities that have invested in fiber optic infrastructure. While many of them can’t get the connectivity they need from the incumbents or lack reliable Internet access, many begin their ventures into better broadband by connecting utility facilities. A new nonprofit, the Post Road Foundation, sees a valuable link between intelligent infrastructure, high-quality connectivity, and sustainability. By bringing together members of the public and private sectors, the Post Road Foundation is implementing an innovative approach to funding. With support from the Rockefeller Foundation, they’ve selected five partners to begin implementing their new approach to funding, connectivity, and sustainability.
Bringing It All Together
Co-founders of the Post Road Foundation, Waide Warner and Seth Hoedl, have decades of experience between them in law, policy, and leadership. Their areas of expertise span cyberlaw, government and finance, environmental law and policy, electricity, telecommunications and energy law and policy, nuclear physics, and the list goes on. Through their years of research and in consulting with both public and private entities, Warner and Hoedl both saw that many rural communities needed better connectivity for economic development, better quality of life, and to keep populations strong. They’ve also found that if local communities or cooperatives are able to use fiber optics to synergize multiple utilities, the community is resilient and more self-reliant.
Smart grid applications along with water and wastewater utility controls are already known to reduce waste and cut costs in places such as Chattanooga. Smart grids can quickly determine where any damage to a network occurs, allows energy to be diverted to prevent loss of service for customers, and if necessary alerts the control center where an outage has occurred. The system prevents or greatly reduce outages, reduces the number and time that trucks and technicians need to be dispatched, and prevents loss of service for customers. Fewer trucks out on the road means cleaner air and less energy consumed. For businesses, it means fewer instances of revenue loss because their operations continue uninterrupted. Smart grids can also help manage peak demands and electrify energy consumption, allowing communities to better use existing utility networks.
Warner and Hoedl are combining their skills to help local communities which are promising candidates for fiber optic infrastructure that will serve multiple purposes beyond Internet access. The Post Road Foundation research platform will bring together private funding resources with local communities for open access dark fiber optic infrastructure.
On May 1, 2018, the nonprofit announced that, they will partner with five diverse entities to develop local pilot programs. These infrastructure projects were chosen to delve into the possibilities and challenges of integrating high-speed Internet access, economic development, sustainable resource management, and digital inclusion. The Post Road Foundation will conduct the studies, tapping outside experts, as needed. The Foundation will also bear up to 90 percent of the cost of each pre-feasibility study; local community partners will contribute the remaining 10 percent, up to a cap of $20,000.
Warner and Hoedl said the criteria that most impressed them with the five communities they chose was their strong leadership, commitment to better services in their area, and an open mind to the Post Road approach. Other factors they considered were the need for high-quality Internet access, the need for a smart grid, and the need for economic development. They were encouraged by the way some of the interested entities were enthusiastic to find ways to use fiber to improve water, energy, and other systems.
Warner and Hoedl want the work of the Post Road Foundation to help communities that need help, so they considered a range of demographics. The Foundation sent a Request for Information to approximately 20 entities that they thought could benefit from their approach and received interested responses from most of them. They chose a combination of different cooperatives, municipalities, and community development initiatives; some are already into projects to bring fiber optic connectivity to the community. The Post Road Foundation will be working with:
- Blue Ridge Mountain Electric Membership Corporation in Georgia and North Carolina
- Presque Isle Electric & Gas Co-op in Michigan
- The City of Sanford, Maine
- Old Town — Orono Fiber Corporation, also in Maine
- A collaboration of community groups in the Downeast region of Maine, including Eastern Maine Electric Cooperative and Downeast Broadband
We recently reported on the Downeast Broadband Utility (DBU), which is beginning with the communities of Baileyville and Calais. One of the difficulties DBU faces is that the state of Maine considers the area “underserved” rather than “unserved,” which makes it more difficult to obtain grants or loans from state or federal sources. As their region ages, they see economic development dwindle and starting a downward spiral for a small rural community.
The Funding Concept
Places like DBU can apply for grants and loans from the Rural Utility Service or the USDA, but the process is competitive and drawn out. The Post Road Foundation hopes this expanded use of fiber optic infrastructure will become an investment opportunity, especially for long-term investors such as pension funds. With each project, they expect to learn more, increase the success of the future projects and heighten the investment attraction.
Warner and Hoedl recognize that state and federal grants and loans are still important to develop local infrastructure projects, but want to introduce a blended capital approach. The Post Road Foundation will provide research to support involvement of a growing pool of investors seeking social impact. An expanding list of investors will reduce the risk for other investors, making intelligent infrastructure projects more financially attractive. Project developers in rural areas will more easily find the support they need for fiber optic deployment.
Increasingly, dark fiber assets are viewed as real estate — owned and leased out to an entity other than the owner — such as an ISP — that “occupies” a certain number of fiber strands. Warner and Hoedl agree and also see investment opportunities in structurally separating different parts of the fiber optic network to attract different types of investors. For example, Warner sees investments in dark fiber, an asset with a 30- to 40- year life and low operating expenses, well suited to long-term, institutional investors.
The Post Road Foundation is taking a neutral approach at this point on models their community partners should adopt. While they’re not advocating against corporate ownership, Warner and Hoedl expect to see many projects develop into open access dark fiber networks owned by communities, operated by another party, with one or more ISPs providing services via the infrastructure.
The Post Road Foundation hopes that the pilot projects will also lead to the availability of communication infrastructure as a platform for technologies that are not yet deployed. Innovative models and applications, such as transactive energy exchange, are in development, but need reliable, low-latency networks for useful expansion.
The Rockefeller Foundation and Others
The Rockefeller Foundation has provided the funds to support the work of the Post Road Foundation. Warner and Hoedl are also quick to mention the help they’ve received from researchers at the Harvard Kennedy School and the Harvard Law School. Harvard’s Berkman Klein Center for Internet and Society and the Initiative for Responsible Investment hosted early research that led to the establishment of the Foundation.
From the press release:
“We are very gratified by the exceptional response to our program from a number of deserving applicants around the country, but the leadership of these initial community partners was particularly impressive. We are excited to have the opportunity to work with these communities, and our research colleagues at Harvard, to explore the potential for bringing high-speed Internet to underserved areas of America. We are also grateful to The Rockefeller Foundation for the funding that made this program possible.” — Waide Warner