A Massachusetts Municipal Light Plant Seizes Internet Access Business Opportunities

Abstract

This report describes the development and recent expansion of HG&E Telecom, the fiber optic network division of Holyoke Gas and Electric (HG&E) in Holyoke, Massachusetts. HG&E is one of 41 longstanding municipal light plants providing electricity service in Massachusetts, of which 10 offer Internet access and other telecom services to retail customers, and 31 do not. HG&E Telecom competes with Comcast and Charter and serves approximately 300 business customers. It saves the municipality more than $300,000 per year. Its revenue has increased by 10 percent over the past two years and it has expanded into new lines of business. Given that data transport needs are growing while electricity sales are flattening, the record of HG&E Telecom suggests opportunities for other municipal electric utilities across the country, as long as they are in states that haven’t raised barriers to the provision of such services.