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Rural TeleCon ‘07. Introduction to IBEC’s BPL Solutions. IBEC, Inc. 285 Dunlop Blvd, Suite K Huntsville, AL 35824 256.492.1000 www.ibec.net. Overview. IBEC’s Experience in Industry IBEC’s Equipment and Investment Estimates IBEC’s Market Focus and Potential BPL Outlook Questions.
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Rural TeleCon ‘07 Introduction to IBEC’s BPL Solutions IBEC, Inc. 285 Dunlop Blvd, Suite K Huntsville, AL 35824 256.492.1000 www.ibec.net
Overview • IBEC’s Experience in Industry • IBEC’s Equipment and Investment Estimates • IBEC’s Market Focus and Potential • BPL Outlook • Questions
IBEC’s Experience in Industry • Established in 2003 for BPL; ISP Services Since 1995 Offices in Huntsville and Hokes Bluff, AL • Full-service Internet Service Provider, Serving Over 5,000 Customers in Northern Alabama and Georgia • Existing ISP & Service Relationships with Utilities mostly Electric Cooperatives • BPL 1st deployed in October of 2002 • Two commercial deployments- VA and IN, passing some 1,500 homes, via approximately 170 mile of power line, (average density is 9 homes/mile) and 300+ paying customers
IBEC’s Experience in Industry • Model - Full-Service ISP Solutions at Competitive Prices With Modest Financial Investment by the Utilities • Turnkey Solution - IBEC Provides Equipment and Services Utility Provides Infrastructure and Customers • Technology Delivers Fully-IP-Based, DS2 Based BPL wired connectivity and Wi-Fi Internet Solutions to Utilities & Their Customers • Solutions are Optimized for Low-Density Marketplace • Electric Cooperatives and Rural Utilities are IBEC’s IdealPartners
5 3 2 1 IBEC’s Experience in Industry Wireless Hybrid BPL Network To Other Customers MV Distribution Feeders (3-4) 4-36 KV Distribution Transformer & LV Secondary Regenerator Unit Regenerator Unit Power Substation MV Power Distribution Lines 802.11 Wi-Fi 802.11 Wi-Fi Fiber To Other Substations SubstationDetail Wireless Router Router / Gateway Regional Communications Center Or Utility Office Ethernet or USB DNS / Billing Servers MV Coupler Typical Residential Consumer Fiber The BPL System consists of the: 1. Head End / ISP Access Connection 2. Substation Router/Couplers 3. Regenerator Units 5. Wireless Router Head-End Modem & Fiber Xcvr Internet OC-3 n x 45 Mbps PSTN n x T1 PRI Voice Router IP-based broadband Internet access over the existing electric power distribution network • Data • Voice • Video Security Fiber
IBEC’s Experience in Industry • Awarded $19.2 Million Loan from RUS Broadband Program in August 2005 (RUS’s 1st BPL Loan) • Loan to fund deployment in 3 Cooperatives (Cullman AL, Central VA, and South Central IN) passing 105,000+ homes • Submitted 2nd Application for $50+Million in September 2006 to deploy 13 additional Electric Cooperatives passing more than 200,000 homes • Currently working on 3rd Application with expectation of 20+additional Cooperatives and approximately 400,000+ homes – to be submitted by mid 2008
IBEC’s Experience in Industry • Tremendous Growth being experienced in BPL industry today • Long-term benefits exist beyond broadband data services • Current products offer bandwidth up to 80Mb of usable data throughput, but like all IT, even greater things to come – SOON • Power lines are the only truly ubiquitous “wires to the home”
Commercial Deployment Trial Deployment IBEC’s Experience in Industry South Central Indiana REMC Princeton Avista Douglas PUD Indianola Municipal Solvay Electric Chelan PUD Bowling Green AEP RPU Orange & Rockland Lebanon City of Sherril Consumers IdahoPower Cinergy Clyde Northeast Utilities United Illuminating ConEd PPL DQE PG&E PEPCO SMECO Sierra Pacific City of Manassas Central Virginia Electric Co-op LADWP City of Salem Duke Progress Energy Santee Cooper San Diego Gas & Electric New Horizon Cullman Co-op APS Courtesy: OPPD Habersham EMC Fayetteville Ameren Southern Company CenterPoint City of Burnet HawaiianElectric City of Weimar HILCO Co-op
Overview • IBEC’s Experience in Industry • IBEC’s Equipment and Investment Estimates
IBEC’s Equipment and Investment Estimates • IBEC Licenses Patented BPL Coupling & System Architecture Technology • IBEC Has Four (4) Pending U.S. Patents: • BPL Regenerator System Architecture • Enhanced MOV Capacitive Coupler Improvements and Methods • Method of Coupling BPL Signals to Underground MV Power Lines • High-Performance Impedance-Matching Device and Methodology • International Patent is Pending on the 2nd-Generation Architecture • The Company Expects to File Additional Patent Applications on: • Feed Method for Delta Power Distribution Systems • BPL AMR integration • Additional New Technologies
IBEC’s Equipment and Investment Estimates • OFDM Modulation • Very Tolerant of Noisy Environments Seen in Power Lines • Fixed Notching With Self-Notching Capability • Remote Notching Capable (Required by FCC)
IBEC’s Equipment and Investment Estimates BRU CAU Access BPL Equipment
IBEC’s Equipment and Investment Estimates In-home / Customer Premises BPL Equipment
IBEC’s Equipment and Investment Estimates IBEC’s Patent-Pending BPL Coupling Technology
IBEC’s Equipment and Investment Estimates Medium-Voltage Access BPL Equipment Installation
IBEC’s Equipment and Investment Estimates • The average Electric Cooperative has approximately 2,200 miles of distribution power lines • The average Electric Cooperative has approximately 18,900 Members • IBEC’s current medium-voltage products require signal regenerator placement approximately every half-mile • IBEC projects a conservative ~ 20% Member subscription rate • IBEC projections based on the above numbers correspond to an ~ $5 Million BPL investment per average Cooperative
Overview • IBEC’s Experience in Industry • IBEC’s Equipment and Investment Estimates • IBEC’s Market Focus and Potential
IBEC’s Market Focus and Potential Mission Statement “To become the leading provider of Internet Protocol (IP)–based Broadband communications over electric Power Lines (BPL) to rural and underserved markets in North America”
IBEC’s Market Focus and Potential • Electric cooperatives are private, independent, member-owned electric utility companies • Established in early 1900s to deliver at–cost electric service to rural consumers • There are 865 distribution electric cooperatives in the U.S. • Serve more than 39 million people and 17 million homes and businesses • Cover more than 2.4 million miles, which is 44% of the U.S. electric distribution grid and over 75% of the nation’s land mass • Span 47 states and more than 2,500 counties
IBEC’s Market Focus and Potential Approximately 75% of the US Land Mass and 44% of the US Distribution Miles are Co-Ops Courtesy: NRECA
IBEC’s Market Focus and Potential Rural Consumers Prefer to Receive Broadband from Their Cooperative Source: Touchstone Energy Broadband Internet Survey, 2003
IBEC’s Market Focus and Potential Rural vs. National Broadband Adoption Source: Pew Internet & American Life Project, 2004
Overview • IBEC’s Experience in Industry • IBEC’s Equipment and Investment Estimates • IBEC’s Market Focus and Potential • BPL Outlook
BPL Outlook BPL Market Growth Projections BPL is expected to grow by a compound annual growth rate (CAGR) of 106% from 2006 to 2012, with 33% of new broadband customers choosing BPL and 12% of existing broadband customers switching to BPL by 2012 (Research Reports International, 2005)
BPL Outlook IBEC has “signed” contracts equaling 07 projection
BPL Outlook Why do Utilities want BPL? (Aggregate Value of Achieved Intelligrid) $671 Billion Productivity Safety Quality Environment Capacity Cost Billions Quality of Life Intelligence Security Source: Electric Power Research Institute Note: 20 year period Reliability
BPL Outlook • BPL is a Growing, Viable “Third Wire” option for Broadband Delivery Anywhere, but especially applicable to Rural Areas • Industry is still Young and Growing; Opportunities Abound not only in U.S., but Worldwide • IBEC currently has 16 Electric Cooperatives under Contract passing some 200,000+ homes, of which ~86% currently have ONLY dial-up service as an Internet Option • IBEC has received RUS Broadband funding for 3 Co-Ops; 13 More are now in Application Review, with More to Follow • Electric Utility Applications are a Huge Long-term Opportunity
Overview • IBEC’s Experience in Industry • IBEC’s Equipment and Investment Estimates • IBEC’s Market Focus and Potential • BPL Outlook • Questions ??
Thank You Contact Information: International Broadband Electric Communications, Inc. 285 Dunlop Boulevard SW, Suite K Huntsville, Alabama 35824 Telephone: 256.492.1000 Facsimile: 256.456.1406 Email: Scott.Lee@ibec.net