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Dominion Energy Powers Up Middle-Mile in Virginia

As an investor-owned utility providing seven million customers in 15 states with electricity or natural gas, Dominion Energy doesn’t fit the typical muni/co-op Fiber-to-the-Home & Business model. In its home state of Virginia, it will be providing middle-mile fiber to connect tens of thousands of unserved people across the Commonwealth as it builds out its fiber network for a smarter, more resilient grid.

Dominion Energy’s ability to offer middle-mile services came as a part of 2019 legislation enabling investor-owned utilities in the state to lease excess fiber capacity to ISPs, resulting in a win-win for the company, the state, and the citizens of rural communities which didn’t have an affordable way to get high-speed broadband.

“The unserved areas across Virginia, and really across United States, look a lot like Swiss cheese,” said Ed Diggs, Rural Broadband Manager, Dominion Energy. “You have pockets of served in unserved areas, the point being it was too costly for any one provider to come in and close those larger unserved areas by themselves. The thought was, ‘Why not leverage utility companies which already have the power lines and rights of way in place?’ We could come in, build our fiber for our utility network, and then lease out some of that excess fiber to willing ISP companies.”

Under the 2019 legislation, Dominion Energy conducted pilot programs in Surry County and the Northern Neck of Virginia and is now transitioning to wider operations across the state, with involvement continuing to grow as other localities heard about the program and wanted to secure their own middle-mile access.

“We’ve got close to 30 different counties and jurisdictions involved,” said Diggs. “By having a middle-mile partner with Dominion, they can focus on being last mile providers. We’re forecasting to build close to 3,000 miles as part of the Virginia broadband initiative, using a portion of that fiber to communicate along our electric distribution infrastructure with our major devices. More importantly it’s allowing our ISP partners to close the gap and serve the unserved areas in Virginia where otherwise the economics didn’t make sense and they couldn’t afford to do it by themselves.”

Dominion Energy started its middle-mile efforts with a single person (Diggs) in 2019. It now has 30 internal employees dedicated to its middle-mile effort, working with hundreds of vendors to research, design, and build out its network at a rate that Diggs described as “very fast, a very compressed timeline.” 

Given Dominion’s status as a regulated utility operating in the state of Virginia, each fiber build must be approved by the State Corporation Commission. The first petition to build 500 miles of fiber took place in 2022 with this year’s petition adding almost 1,900 miles. A few more counties are expected to file petitions in 2024 to continue to increase the size of the network. 

Internet service providers are leasing the dark fiber from Dominion and provide the electronics necessary to connect and light it, with the leasing costs being used to offset the construction build and other overhead costs to maintain and repair it. Most of the fiber is aerial deployed and is being installed in such a way to minimize any make ready costs. 

Any excess capacity not used by the ISP or Dominion could be available for other parties. “There’s no provision to say we can’t lease any excess fiber to other broadband providers, whether they’re cellular providers or another ISP company on the back end once we’ve met the unserved obligations with our ISP partner,” said Diggs.