Ubiquity has secured a green loan, a form of environmentally focused financing, to support its open access fiber-to-the-premise networks in Texas, California, Arizona and Nebraska.
Ubiquity did not comment on the size of the loan, but Chief Revenue Officer Greg Dial said all proceeds will support ongoing greenfield infrastructure builds in its core operating regions in those states, which are all under active construction today and funded by the provider's existing investor base.
The newly announced loan will “supplement activity in these regions as we enable a new generation of connectivity fostering local economic growth and development,” Dial told Fierce Telecom.
Proceeds are backed by the company's assets and involves multiple lenders, with Woodforest National Bank leading. Ubiquity's other equity sponsors include sustainable infrastructure investment firm Generate Capital.
Ubiquity was able to qualify the loan as "green" by demonstrating that the proceeds will be used to fund the development and construction of fiber networks, which are eligible projects under the Green Loan Principles established by the Loan Market Association (LMA) and under Generate Capital’s Green Financing Framework.
“Fiber networks inherently have low energy usage and are more energy efficient than conventional copper-based communications networks,” added Dial.
Indeed, advocates have claimed that fiber is "greener" than copper or cable. One reason for that could be fiber is often referred to as a “passive” technology because it uses passive optical networking (PON) technology and therefore doesn’t require any electricity to power it. Fiber uses unpowered optical splitters instead.
Still, Ubiquity is working to reduce emissions in its backup power systems associated with its fiber networks. For one, by shifting from diesel generators to gas, Dial noted.
The new green loan proceeds will be “drawn and instituted immediately.” Ubiquity didn’t comment on the terms of the loan, but said it specifically is collateralized by its fiber-to-the-premise deployments.
Founded in 2019, the fiber provider is one of a growing cohort of open access network providers in the U.S. The open access network model means infrastructure is deployed by one company and then leased to multiple internet service providers, which can then offer broadband service to end customers.
In August, Ubiquity announced several new open access networks in California, Nebraska and Arizona.
At the time, Dial noted there’s “a lot of momentum” in open access networking, as some larger operators are finding it more efficient to use third parties for buildouts.
All of Ubiquity’s networks offer tenants either a connection to dark fiber or lit fiber. Earlier this year, Ting Internet struck a deal to expand an existing partnership deal with network infrastructure company Ubiquity, which will allow it to reach 150,000 new locations in Mesa, Arizona and Carlsbad, California over the coming years.
The open access network model, which has been popping up in more and more markets this year, has been touted by players in the industry as being especially beneficial for consumers. Some have said open access networks give consumers a choice of providers and can be less disruptive to communities as they don’t have to endure multiple companies digging up streets to deploy fiber.
And for providers, the return on capital investment can be rough if there are too many competitors building new infrastructure in a market, so open access networks could remove some of that burden.
Fiber builders in Mesa, Arizona alone include Google Fiber, Lumen Technologies, SiFi Networks, Wyyerd, Generate Ubiquity and AT&T’s joint venture Gigapower. Some of them are building open access networks, and some of them are not.