We need direct NBN services: utilities

We need direct NBN services: utilities

Summary: The Energy industry has rejected calls from Optus, Telstra and the Federal Opposition for the National Broadband Network Company (NBN Co) to be prevented from supplying retail services to utilities, saying that receiving retail services would over-complicate energy networks.


The Energy industry has rejected calls from Optus, Telstra and the Federal Opposition for the National Broadband Network Company (NBN Co) to be prevented from supplying retail services to utilities, saying that receiving retail services would over-complicate energy networks.

In submissions to the Senate committee examining NBN legislation — National Broadband Network Companies Bill 2010 and Telecommunications Legislation Amendment (National Broadband Network Measures — Access Arrangements) Bill 2011 — Telstra and Optus had argued that NBN Co would be engaged in "mission creep" if it offered services to utilities such as electricity companies. A provision in the legislation allows this to happen.

Tanya Barden, director for the Energy Networks Association (a body which represents 26 gas and electricity companies), told the Senate committee hearing on Friday that the energy sector was concerned by the submissions and the calls from the Federal Opposition to amend the legislation to remove this clause.

"This is likely to increase the cost of delivering network services in instances where the NBN's direct access would have otherwise been a cost-effective and feasible solution," Barden told the inquiry.

Barden said that should NBN Co be prevented from offering retail services to utilities, energy companies would have no option but to:

  • Buy services from retail service providers at a higher cost, bringing up the total cost for running energy networks;
  • Use wireless services that "have been unable to provide the level of reliability required" in the past during disasters such as Tropical Cyclone Yasi; or
  • Deploy their own infrastructure, leading to network duplication with the NBN.

Andrew Deme, group manager for telecommunications at Ergon Energy, argued that NBN Co would not be in competition with retail providers in offering such services because energy suppliers required a basic access to the NBN grid and did not require "value-add" options such as internet access or Voice over Internet Protocol that retail service providers would include.

The value-add would only serve to make it much more difficult for utilities to use NBN services, he said. For example, two transformers on the grid would need to be in instantaneous contact with each other without going through a retail service provider's point of presence (POP).

"The reason for this is that utility service level requirements are higher than those of a retail customer. Evidence has shown that utilities need a high degree of control over communication services in order to attain the necessary service levels," Barden added.

"Once a retailer takes an NBN Co service and integrates this with their own network or adds their own electronic equipment, then this introduces a range of complexities and unknowns that add risk for the reliable operation of energy networks."

Liberal Senator Mary Jo Fisher questioned why utilities should receive "special" treatment from NBN Co when hospitals and schools were not able to directly receive services from NBN Co. Barden said energy was such a critical service that hospitals would be unable to operate without it.

"As we have indicated, resilient communications are necessary for the electricity industry to get up and running after major disasters, and that is intrinsic to delivering so many other essential services to the community," she said.

Shadow Communications Minister Malcolm Turnbull's attempts to amend the legislation in the lower house of parliament were unsuccessful. The legislation has been passed in the lower house, but still has to go through the Senate.

Topics: Government, Broadband, Government AU, Telcos, Optus, Telstra, NBN


Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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  • There should be no such thing as an "energy industry" just as there shouldn't be a "telecommunications industry". Both ought to be public utilities owned by the people and run not for profit but for the general welfare, meaning the benefit of the citizenry and for the use of private enterprise which also benefits the citizenry.
    • Couldn't agree more Sean.
      Governments have abrogated their responsibility to provide the people with essential services. They sold off the assets to meet short-term budget deficits. Now we have multi-layered management armies of energy traders and telecomunciations traders busy doing business with each other to support greedy shareholders and enriching themselves at our expense.

      Lets face it. When the electricity goes off for an extended period, as happened in NZ and California, the incumbent government is held responsible by the voters, not the "energy industry".
  • Question: how are the energy getting their telecommunications infrastructure now?
    Dean Harding
    • They send people to your house to read your meter. There is the capability of wireless services which require a vehicle to slowly travel by and download the data from each house but this still takes a long time.

      Sensors could be placed on all transformers and infrastructure points monitoring performance and throughput. This could allow realtime running of the power grid to a degree that I do not think is currently experienced.

      Of course this could be done with copper and ADSL today but it may be easier to connect all their infrastructure while the NBN is being rolled out?
    • Energy companies have a lot of fibre now. google OPGW and ADSS.

      They can't use the NBN hub and spoke model as most of the need is for point to point and ring's. Have a look at the coopers switch's on the pole in your street. It needs fibre for the protection relay (IED) to operate. they dont use IP/ethernet over the fibre. google IEEE C37.90. (Yes IEC61850 is coming, buts its only layer2 and has no support for interstation comms, thats the fibre in the street)

      google sp-ausnet and NBN for example. NBN wants to use sp-ausnet assets.

      Did you know that a Vic power company has fibre to Tas and telstra does not. Optus uses it for there data.

      How many telstra cables hang on power poles. (telstra has a lot of cables underground now, but a LOT is overhead still). I think it would be cheaper to replace a overhead with a fibre than dig a hole.

      Look at victoria. the power company will connect to every powermeter by 2013 (see AMI & DPI website) using silverspring & WiMAx. They will have more wireless devices than telstra. (not every location has a phone, but most have a power meter, think pumping stations, traffic light controlers, billboards, etc they all need power but not a phone). It would make a lot of sense to use the NBN than run there own wireless network that will be bigger than telstra in the same area.

      Also the NEW smart meter allows the power company to turn your power ON/OFF. You will not be happy if the POI is down, (No Power) and they can't turn you on, even though there is power in your street beacuse of the hub and spoke design.

      NBN will deploy a network with a lower SLA than power companys need. But there are Bits they can use, if allowed. eg point to point core from NBN

      It would make sense for power companys and NBN to share fibre cores. So we don't have the pay TV cable problems of past
      • ProtMan, some interesting points, but you're way off on fibre to Tasmania.
        Telstra has 2 links (since 1995 & 2003) also used by Optus for redundancy. Singapore-owned Basslink (HQ'd in Vic) has operated a commercial fibre since mid-2009. Their fibre is also used for SCADA of the Basslink electricity interconnector.
        Digital Tasmania
        • Digital Tasmania, Your correct! I should double check my comments. It should have read
          "Did you know that a Vic power company has fibre to Tas and telstra does not USE THIS FIBRE. Optus uses it for there data."

          SCADA is one of the reseson, but the no 1 reason is Protection of the powercable. They are using 2 Digital Line Current Differential Relays Protection at each end of the circuit (4 total in a X & Y config). These IED's can pickup a fault in under 10ms (half a cycle). They dont use ethernet for that.
  • I hope the energy companies sell the electricity to the NBN though a ESP.
    I seriously dont believe that a NBN should be forced into selling services though a RSP. They should be able to sell to anyone and have a one off charge that is required be able to get services so this stops every joe bloggs out there from becomming a RSP
  • @Gooterz, what your proposing now looks like a Telstra.

    @Dean Harding, I believe they are buying from Telstra Wholesale.

    Why doesn't "Energy Networks Association" become/create an RSP that specializes in network connections for Energy related companies. That way, they can standardize the equipment used, have the required SLA's, etc...

    NBN co, shouldn't have to need to be worried about "end-users" (consumers). They should concentrate on providing quality infrastructure at without the bloat that Telstra became by concerning itself with retail products.