Smarter Grids, Faster Bits – Fiber as the Driver
July 14, 2025
Written by Alan Nicholson, Executive Advisor
Adopting an Enterprise Fiber Strategy is crucial for utilities that increasingly view their fiber assets as strategic infrastructure that supports long-term business and digital growth. Owning fiber assets gives utilities full control over their connectivity needs, enabling secure, high-performance communication and reducing reliance on third-party providers. It allows for scalable bandwidth and rapid deployment of modern technologies, which is essential for cloud, AI, and data-driven operations. Fiber also enhances cybersecurity and compliance by offering private, dedicated pathways for sensitive data. Financially, it can be treated as a capital asset that appreciates in value and strengthens the company’s balance sheet. Overall, fiber ownership aligns with enterprise goals around resilience, innovation, and competitive advantage.
At a Glance:
Utilities should proactively develop an Enterprise Fiber Strategy to guide decisions around balancing security, costs, and control levers of their infrastructure.
Organizations should consider a variety of internal and external use cases when leveraging fiber assets on their network.
Utilities can use their existing infrastructure and rights-of-way to economically deploy fiber capacity and capitalize on it via wholesale leasing or even retail broadband service offerings.
Strategic deployment of fiber assets enhances operations and creates potential new revenue streams through dark fiber leasing and/or lit-service offerings.
Enterprises, especially power utilities, increasingly use fiber optics to manage complex networks of micro-grids and renewable energy sources.
Fiber optics facilitate communication for integrating renewable energy sources, such as connecting wind turbines.
Background:
A robust communications network truly is the enabling technology for the smarter grid. These grid modernization efforts are driving the need for higher bandwidth, faster speeds, lower latency, higher reliability, and more security that is unsurpassed in optical fiber communication. Many electric utilities are responding to these communication requirements of the future by pushing fiber deeper into their networks, closer to devices and equipment with which they need to communicate. Electric utilities of all sizes, and in all geographic regions, should be developing and implementing an Enterprise Fiber Strategy as they look to the future.
Fiber optics offer several benefits for utilities that understand how to leverage their fiber assets to meet strategic business:
High-Speed Communication: Fiberoptic networks provide significantly faster data transmission compared to traditional copper networks. This capability is essential for grid management and real-time data processing.
Reliability and Low Latency: Fiber networks are immune to electromagnetic interference, less susceptible to environmental disruptions and offer lower latency, ensuring consistent and reliable connectivity. This reliability is essential for maintaining productivity and supporting critical business applications.
Scalability: Fiber-optic technology is highly scalable, allowing businesses to easily upgrade their bandwidth as their needs grow. This scalability supports business expansion and the increasing demand for advanced applications, technologies, and services.
Enhanced Capacity: Fiber cables can carry more data over longer distances without signal degradation.
Improved Safety: Fiber optics are less vulnerable to severe weather conditions and do not pose the same fire risks as traditional cables.
Efficient Infrastructure Use: Utilities can leverage existing power structures for fiber deployment, reducing the need for new infrastructure.
However, we often observe that many enterprises are either not ready or not structured appropriately to leverage their enterprise fiber assets. This begs the question: why is implementing an Enterprise Fiber Strategy so challenging? Here are a few reasons why:
High Initial Investment: The cost of constructing or acquiring fiber infrastructure can be considerable, ranging from $30,000 to $1,000,000 per route-mile, depending on geography. This significant upfront expense can be a barrier, especially for smaller enterprises. As an example, aerial installation of fiber optic cable costs an average of $5 to $15 per foot, while underground installation ranges from $15 to $30 per foot.
Deployment Timelines: Fiber construction timeframes typically span from 6 to 18+ months and are highly susceptible to delays related to permitting and construction moratoriums. Speed-to-market can be a critical factor, and extended timelines may hinder timely deployment.
Regulatory Compliance: Enterprises must navigate complex regulatory requirements, including environmental, financial, safety, cyber-security, and tax regulations. Ensuring compliance while tapping business synergies for both the power grid and high-speed communications can be challenging.
Skill and Capability Gaps: Developing mature telecom capabilities in planning, design, construction, operations, and maintenance is essential. Enterprises may face gaps in expertise and may need to build or acquire the necessary skills and systems to support fiber deployment.
These challenges necessitate a comprehensive approach to ensuring a successful adoption (and execution) of an Enterprise Fiber Strategy.
Understanding the Use Cases:
The internal and external use cases for optical network deployment focus on enhancing OT and IT infrastructures, including grid modernization and smart grid technologies. Internally, this involves strategic optical network planning to improve resiliency and support future needs. Externally, the use cases include leasing dark fiber, providing lit services, and partnering with various service providers to build and operate network infrastructure.
Internal Use Cases
Operational Technology (OT):
Transmission, Distribution, Generation, Grid Modernization: Enhancing infrastructure for electricity transmission, distribution, and generation, including modernizing the grid.
Private Mobile Backhaul and Smart Grid: Implementing private mobile backhaul solutions and smart grid technologies.
Strategic Optical Network Deployment: Emphasizing a thoughtful approach to deploying optical networks, ensuring a well-planned architecture to support current and future needs, and improving resiliency.
Ring Network Improvements: Addressing and improving existing ring network designs.
Exploring New Network Designs: Investigating and implementing new network designs that do not rely on ring structures.
Information Technology (IT):
Data Centers, Offices, Cloud, Telephony, Radio Backhaul, Physical Security: Enhancing IT infrastructure across various domains such as data centers, office networks, cloud services, telephony, radio backhaul, and physical security.
Leveraging Rights of Way (ROWs): Utilizing ROWs and building entrances to benefit the enterprise's overall infrastructure.
External Use Cases
Dark Fiber:
Leasing Fiber Optic Cables/Strands: Offering dark fiber leases, which involve leasing the physical fiber optic cables without any active electronics.
Lit Services:
Optical (DWDM/Wavelengths), L2 (Ethernet), L3 (IP): Providing lit services at different network layers, including optical wavelengths (DWDM), Ethernet (Layer 2), and IP (Layer 3), available in both wholesale and retail models.
Neutral Provider Transport:
Optical Wavelength Transport: Acting as a neutral provider for optical wavelength transport, offering bulk transport services.
Collaborations: Partnering with Network Service Providers (NSPs), Internet Service Providers (ISPs), Data Center Providers (DCPs), and potentially government or municipal entities for Fiber to the Home (FTTH) and broadband services, available in both wholesale and retail models.
External Partnerships:
Infrastructure Development: If not managed internally, partnering with external entities to design, build, and operate physical Outside Plant (OSP) infrastructure, including cable runs and huts. This includes securing facility access, defining terms and conditions, and delineating responsibilities.
How to Get Started:
First and foremost, utilities must use their fiber assets to meet their internal communication needs and benefit from the infrastructure. They need smarter networks with high-bandwidth communication, low latency, and high availability for applications like tele-protection. While deploying fiber only for internal use cases may not be cost-effective, sharing deployment costs between internal and external uses could make it more attractive.
Business Objectives: Utilities should identify how and where fiber assets can be best utilized to support both short- and long-term business needs. Prioritizing core business functions over potential external needs ensures that investments are aligned with broader financial objectives, supported by adequate IRR and TCO models. Fiber’s virtually limitless bandwidth potential, capacity to transmit longer distances with less regeneration, and lower operating costs make it commercially compelling. As optical technology continues to improve, the same fiber pair can transmit ever-increasing bandwidth, making it a future-proof asset for evolving connectivity needs.
Strategic Alliances: Actively developing partnerships with neighboring utilities or service providers can create mutually beneficial capabilities. These alliances can enhance the overall effectiveness and reach of the fiber strategy, creating a collaborative environment for growth. Utilities can use their existing infrastructure and rights-of-ways to economically deploy fiber capacity and capitalize on it via wholesale leasing or retail broadband service offerings. E
Telecom Expertise: Building mature telecom capabilities in planning, design, construction, operations, and maintenance is essential. Establishing robust processes, procedures, and standards ensures that the fiber infrastructure is reliable and efficient, supporting the company's operational goals. Fiber optics drive high-speed communication across industries, with utilities using it for grid management and broadband. In the oil and gas industry, fiber is used in distributed acoustic sensing (DAS), distributed temperature sensing (DTS), and distributed vibration sensing (DVS).
Regulatory Compliance: Ensuring safety, reliability, and adherence to environmental and financial standards is crucial. Regulatory compliance helps manage risks, secure necessary approvals, and align with policy goals, safeguarding the company's interests and reputation. State and federal programs, such as the BEAD program, will significantly accelerate deployment spending, injecting almost $100 billion into the system. The Fiber Broadband Association estimates that 205,000 additional workers will be needed through 2026 to support network expansions.
Service Offerings: Clearly establishing and communicating how fiber assets are used for internal enterprise requirements versus external/commercial services is vital. Service level agreements with external customers should be operationally viable, ensuring that the company's offerings are competitive and sustainable. Different operators have varying perspectives on fiber based on their specific investment criteria, existing assets, target growth areas, and long-term strategies. Utilities are increasingly using fiber optic cable to manage complex networks composed of micro-grids and renewable energy sources.
Operating Model: Driving coordination, awareness, and efficiency between various teams such as Field Operations, Technology, Sales, Marketing, Finance, and Security is key. A transparent governance model ensures that all stakeholders are aligned and working towards common objectives. Utilities should be proactive in developing a future-proof fiber networking strategy by forming partnerships with neighboring utilities or telephone utilities.
Secure Infrastructure: Protecting fiber optic networks from both physical and cyber threats is essential to ensure continuous operations and safeguard against potential risks. A secure infrastructure is foundational to maintaining the integrity and reliability of the company's fiber assets. Fiber optics are used in various industries, such as oil and gas, for distributed acoustic sensing (DAS), distributed temperature sensing (DTS), and distributed vibration sensing (DVS). The increase in video applications for security and asset monitoring also highlights the need for high bandwidth and low latency networks.
At Windval, we understand the complexities enterprise utilities face in developing business-driven technology strategies such as an Enterprise Fiber Strategy. Bringing together key leaders from the business, IT, and operations is essential to developing a strategy that supports core business functions while also leveraging potential new business opportunities and partnerships. Our team of Executive Advisors is ready to learn about your environment, understand the strategic direction of your business, and support the development of an Enterprise Fiber Strategy that addresses your unique business and technology needs. From informal discussions to structured workshops, Windval can tailor an engagement to begin putting your organization on the path to success.