Utility operator CenterPoint Energy Inc. and IBM will team up to test new technologies for delivering high-speed Internet access over electrical power lines, the companies said on Monday.

The companies said the technology would also allow the utility to monitor its grid more closely and in real time.

The announcement was the second large investment recently in broadband-over-powerline (BPL) technology, which has been through dozens of tests in the United States but few commercial roll-outs.

"At this point, the technology is fairly well proven ... but nobody has sufficiently proven to our satisfaction that it can work economically," said Joseph Laszlo, a senior analyst for Jupiter Research covering broadband.

CenterPoint said its trial will cover a 220-home area in Houston and run through this August, after which it will evaluate consumer response and the merits of a larger deployment. It has also opened a technology center in Houston, with design help from IBM.

"We're very optimistic on both deployments, but the utility automation is certainly a step ahead," said Don Cortez, vice president with CenterPoint in Houston responsible for the deployment of BPL technology.

Among the benefits CenterPoint said it could derive from automating the grid are the detection of outages and remote meter reading, which would eliminate the need for meter readers.

CenterPoint declined to disclose the cost.

Last week Current Communications Group, which develops BPL services, said it received a major investment from a group including Google Inc. and Goldman Sachs to accelerate the deployment of its technology. The Wall Street Journal reported the investment approached $100 million.

Broadband service over power lines has been highly touted by equipment makers and federal regulators as a possible competitor to cable and telephone services that handle almost all of the roughly 40 million U.S. residential broadband connections.

But few electric utilities have attempted to sell the service to customers, citing cost and technical problems. The signals used to carry data over electrical lines can cause interference with radio equipment, and can travel only a short distance before weakening, requiring repeaters in many areas.

Laszlo said Jupiter currently forecasts that BPL and other alternative forms of high-speed Internet access, such as wireless and satellite service, will garner no more than 2.5 million households by 2010, compared to 67 million households with cable or DSL service.

He said BPL might clear some of its hurdles by combining with other technologies such as long-range wireless services. Motorola Inc. announced such a system in May.

"Taking a very pragmatic, practical approach, looking at all these different technologies and maybe tying them together in creative ways is the best way to overcome the limitations they all seem to have at this point," Laszlo said.


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