The LTE Family of Networking Protocols Represents Utilities’ Most Future-Proof Option

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Richelle Elberg's picture
Principal Research Analyst, Guidehouse Insights

Richelle Elberg is a principal research analyst overseeing Guidehouse Insights’ IoT and Connectivity solution. She also supports the Digital Innovations, Neural Grid, and AI and Advanced...

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  • Aug 26, 2020

This item is part of the LTE Networks & Utilities - Summer 2020 SPECIAL ISSUE, click here for more

It’s been a longtime coming, but the day for power utilities to consider deploying a private LTE (PLTE) network is here. Several factors are coming together in a perfect storm of market conditions and technical innovations that make PLTE more attractive—and viable—for utility needs than ever before. In this article, Guidehouse Insights shares its thinking around PLTE for power utility applications, and why the LTE family of protocols is likely to become an important utility industry standard in coming years.

Digitalization Is King

The advent of the Fourth Industrial Revolution (Industry 4.0) is upon us. To remain competitive, safe, reliable, and efficient, grid operators must embrace a range of digitization technologies. These include sensors, analytics, and the cloud. But ubiquitous, flexible, and future-proof communications networking is foundational to these Industry 4.0 technologies.

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Historically, most utilities have taken a scattershot approach to their networking needs, building ad hoc, application-centric (and often proprietary) networks to perform just one or a handful of tasks. These projects are often undertaken within operational silos, with a mix of wired and wireless, public and private solutions. Looking ahead, utilities should consider a holistic, long-term plan for territory‑wide connectivity. A strategy built around the family of LTE wireless technologies presents a versatile and virtually future-proof solution.

LTE Is the Gold Standard for High Capacity Wireless Networking

LTE-based networks have become the global standard for wireless networking for voice and data applications. They also provide the basis for future 5G systems, which promise to enable new and more advanced capabilities.

In the US, several large investor-owned utilities are considering buildout of PLTE networks. Ameren and New York Power Authority have each announced plans for PLTE. Not only has the cost to build an LTE network come down, thanks to widespread deployment by carriers worldwide, but also new spectrum options are available.

Why LTE?

Infrastructure vendors, cellular service providers, and standards bodies worldwide have coordinated to develop several LTE-based specifications. In addition to 4G LTE protocols, LTE Cat 1, LTE Cat M1, and Narrowband-Internet of Things (NB-IoT) are relevant to utility smart grid, smart lighting, and smart city applications.

NB-IoT operates at sub-gigahertz frequencies with the goal of provisioning low data devices and sensors with low power requirements. It will have the lowest cost and throughput of LTE-based networks. LTE Cat M1 consumes more power than NB-IoT but offers better downlink performance and interference immunity. Most modems combine Cat M1 and NB-IoT into one module. LTE Cat 1 offers broadband capabilities in more affordable packages than 4G and requires less power than traditional 3G or 4G nodes.

4G LTE offers latencies as low as 10 ms and bandwidth adequate for video applications. As a result of global deployment, a large ecosystem of vendors exists and economies of scale have already been achieved.

Furthermore, the next generation of wireless technology—5G—is an evolutionary overlay to existing 4G LTE networks. The standards will allow public and private LTE network operators to transition to 5G networks in an incremental fashion, eliminating the obsolescence issue that has historically plagued industrial users (e.g., utilities).

The transition from 4G to 5G will be more gradual than previous evolutions in cellular networks, with greater sharing of infrastructure and easier switching between service levels. In the end, however, 5G will be a radically disruptive technology that will usher in new uses and applications for industrial users such as utilities. In short, this family of LTE-based standards will ultimately converge in the 5G networks of the future, providing a powerful and flexible platform for utility use cases—one for which the foundation can be built today.

Spectrum Options Are Growing

LTE technology is widely deployed by cellular carriers worldwide, across a variety of spectrum bands, including 700 MHz, 800 MHz, 850 MHz, 900 MHz, 1.7 GHz, 1.8 GHz, 1.9 GHz, 2.3 GHz, 2.5 GHz, and 2.6 GHz. Regulatory bodies worldwide are also making new bands available, and a shared spectrum model has recently gained traction.

Spectrum sharing is the simultaneous use of a specific radio frequency band in a specific geographical area by several independent entities. In addition to governmental regulatory bodies such as the US Federal Communications Commission (FCC) and the UK Office of Communications, private entities such as Google, Intel, and Qualcomm are promoting shared spectrum standards.

The bands being explored are typically underutilized, such as 150 MHz formerly controlled by the US military at 3.5 GHz, known as the Citizens Broadband Radio Service (CBRS). Spectrum sharing efforts are also underway across Asia, Europe, and the Middle East.

CBRS Shared Spectrum Is Available in the US

CBRS refers to 150 MHz of spectrum in the 3.5 GHz to 3.7 GHz band. The FCC has designated sharing among three tiers of users: incumbent users, priority access license (PAL) users, and general authorized access (GAA) users.

The incumbent tier is reserved for grandfathered users in the band. The PALs tier is for users that purchase spectrum licenses at auction. The auction for PALs began in July 2020 and as of mid‑August, more than $4 billion has been bid. The GAA tier is unlicensed spectrum that users can access for free.

Many energy and utility concerns are actively considering use of the shared CBRS bands for LTE‑based deployments. Alabama Power, Exelon, Hawaiian Electric, San Diego Gas & Electric, and Southern California Edison are all bidding in the PAL auction, along with several cooperatives and municipals. Many utilities are also evaluating the free GAA bands for PLTE.

Private Spectrum Options for LTE-Based Industrial IoT Networks

Although unlicensed or shared spectrum options will be less costly in the near term, owning private spectrum may ultimately become a competitive advantage. In the US, there are several private bands available to utilities for PLTE deployment. For low capacity sensor network deployment, the 700 MHz A-block Guard Band will support an NB-IoT network. This spectrum has been acquired or leased by numerous utilities for sensor or SCADA network purposes, including FirstEnergy, Idaho Power, Portland General Electric, National Grid, and others.

There is also spectrum in the sub-gigahertz range available to utilities. In May 2020, the FCC voted to approve a realignment of 6 MHz in the 900 MHz band. The 6 MHz is split between two 5 MHz holdings at 897.5 MHz-900.5 MHz and 936.5 MHz-939.5 MHz. These tranches are available on a county-by-county basis and license owner Anterix is actively marketing them to the utility industry.

Outside the US, the European Utilities Telecom Council has proposed harmonization of the 450 MHz range for critical communications. In China, 230 MHz spectrum is allocated to utilities and grid operators.

Industry Standardization Could Have Long-Term Value

Beyond the flexibility and potential value creation that PLTE will produce for individual utilities, Guidehouse Insights thinks there could be even greater benefit to the industry if stakeholders standardize around the LTE family of protocols.

Industry transformation is underway. And although its impact might not be immediately clear at the local level, more broadly, utilities worldwide will be faced with a vastly more competitive operating environment in coming years. The need for a holistic, high capacity networking strategy can already be seen in places where solar and EV penetration is high. Years from now, when those penetration levels are substantially higher, the existential threat that Tesla (and its rivals) could have on the monopoly utility industry should not be underestimated.

The day may come when multiple utilities, across state or even country borders, want to coordinate their efforts for grid operation and stability or for customer engagement and marketing purposes. The LTE family of networking protocols is the obvious, most future-proof option. Utilities should prioritize buildout of this critical Industry 4.0 infrastructure. If the industry standardizes on PLTE technology, building a compatible, interoperable network of networks, it will be better prepared for the competitive stresses that transformation will bring.


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