A new law in Mississippi is unleashing electric cooperatives to explore broadband internet access for their members. But significant financial and density barriers for rural connectivity remain.
“We got permission from the legislature, now we need patience from everybody,” said Michael Callahan, CEO of Electric Cooperatives of Mississippi.
Gov. Phil Bryant signed the bipartisan Mississippi Broadband Enabling Act on Jan. 30 after it cleared the state Senate unanimously and the House 115-3.
The new law does not mandate that electric co-ops pursue broadband but expands their authority to do so through an affiliate that is separate from their electric service. Co-ops can hang broadband fiber on their existing power poles and lease it to the affiliate. Or, the affiliate can partner with an internet provider to get the job done.
With internet access below standard or nonexistent across Mississippi, alliances of businesses, civic groups and colleges last year requested legal clarity for electric co-ops to enter the broadband space.
“There was a large push from citizens in Mississippi who live in rural areas,” said Jason Siegfried, president and CEO of Southern Pine Electric, headquartered in Taylorsville.
When it comes to internet access in his co-op’s service territory, “a large portion has none at all,” he said.
That means a high percentage of children cannot do online homework assignments, houses are harder to sell, and farmers lack the advantage of smart equipment to run their poultry houses, he said.
Upon learning of Southern Pine’s internal fiber network, one elderly member made a personal plea to the co-op. “His doctors told him that if he had a good enough internet connection, he wouldn’t have to drive 30 miles one-way for them to get data from his pacemaker,” Siegfried said.
Southern Pine Electric is one of many co-ops undertaking feasibility studies on how to bring their members affordable high-speed internet.
“Once we have a fully vetted business plan that our board is confident in, and our members are absolutely supportive of us doing this, we can move forward,” Siegfried said.
Biggest Boardroom Decision
The rural nature of Mississippi makes broadband delivery an expensive proposition.
“Projects of this magnitude could be the biggest decision made in the boardroom in some time,” said Siegfried.
A study commissioned by a majority of Mississippi’s 25 co-ops estimates costs at $1.5 billion to deliver broadband fiber-to-the-home to 75 percent of their members.
“Our biggest problem is our density,” said Callahan. “Each co-op will have to look at its own demographics and density and whether it makes sense for them to do this.”
Co-ops in some parts of the state have as few as four customers per mile of powerline, he said. The national average for co-ops is about eight customers per mile.
With the new law, two co-ops have said they may build a broadband business and initiate connections as early as next year, and already internet providers “are upgrading their speeds and bringing their prices down,” said Callahan. One general manager told him the local cable company now plans to expand service and deploy fiber.
“Several independent telephone companies have also reached out to co-ops to work together. They are exploring those possibilities,” he said.
“The new law provides our electric co-ops various opportunities to provide or assist in delivering broadband services in Mississippi. And that was the goal of the bill.”
Cathy Cash is a staff writer at NRECA.