Telefónica speeds up closure of copper exchanges

Telefónica España, in response to sharp rises in energy prices, has reportedly accelerated its plan to shutter copper exchanges and replace them with more energy-efficient fibre technology.

The new deadline for completion of the so-called FARO project, as reported by Cinco Días, is April 2024. When Telefónica initiated the decommissioning of copper plants in 2016, FARO was expected to be done and dusted sometime during 2025.

If the new target is to be achieved, the pace of closures will have to pick up considerably. According to Cinco Días, Telefónica has shuttered roughly a quarter of its copper exchanges, leaving about 6,300 still to receive the FARO treatment.

As of August 2021, when the milestone of closing down 1,000 copper exchanges was passed, Telefónica said it had encountered resistance from the Comisión Nacional de los Mercados y la Competencia, Spain’s competition watchdog. The regulator expressed concern that an overly swift shutdown might leave wholesale customers of Telefónica’s copper-based ADSL products high and dry.

The number of customers that Telefónica still needs to migrate from copper to fibre is sizeable, despite Spain having one of the highest full-fibre penetration rates in Europe. Cinco Días reports that 1.12 million residential customers of the operator still use copper-based access products, while the corresponding number in the business segment is 435,000.

Copper-plated savings and income

According to Telefónica, one fibre exchange serves the same number of accesses that are served by four copper exchanges.

Moreover, fibre access technology occupies only 15% of the space of copper access. The closure of 1,000 copper exchanges, indicated the operator, results in energy savings of more than 1,000GWh (apparently equivalent to 355,000 tonnes of CO2, or the planting of six million trees).

There is also income to be had from selling real estate occupied by copper local exchanges in city centres, as well as dismantling cable, recycling electronic waste, and reusing network cards.

According to Cinco Días, Telefónica Group has already raked in €200m (£172m) from selling copper network assets to Australian finance group Macquarie, with apparently more copper sales lined up.

Burnishing green credentials

Coinciding with the 2022 United Nations Climate Change Conference (COP27) held in Egypt earlier this month, Telefónica released a report claiming that the environmental impact per PB of its fibre-to-the-premises network in Spain was 18 times lower than that of copper.

The greener performance, said Telefónica, was helped by “previous efforts in terms of energy efficiency, design and implementation of new technologies, and investments in renewable energy”.

In terms of mobile networks, added Telefónica, the environmental impact per PB of the 4G/5G network has been shown to be seven times lower than 2G/3G because of “lower and more efficient energy consumption during data transport and processing in the network system”.

“ We are aware of the urgency of reducing CO2 emissions and have therefore reinforced our targets to help limit the global temperature increase to 1.5ºC. Our targets go beyond the Paris Agreement, and we are committed to reaching net-zero emissions by 2040 across the value chain, as well as neutralising emissions from our main operations by 2025. ”

Maya Ormazabal, Director of Environment and Human Rights, Telefónica.