Interconnection

In telecommunications, interconnection is the physical linking of a carrier's network with equipment or facilities not belonging to that network. The term may refer to a connection between a carrier's facilities and the equipment belonging to its customer, or to a connection between two (or more) carriers.

In United States regulatory law, interconnection is specifically defined (47 C.F.R. 51.5) as "the linking of two or more networks for the mutual exchange of traffic."

One of the primary tools used by regulators to introduce competition in telecommunications markets has been to impose interconnection requirements on dominant carriers.

History

United States

Under the Bell System monopoly (post Communications Act of 1934), the Bell System owned the phones and did not allow interconnection, either of separate phones (or other terminal equipment) or of other networks; a popular saying was "Ma Bell has you by the calls".

This began to change in the landmark case Hush-A-Phone v. United States [1956], which allowed some non-Bell owned equipment to be connected to the network, and was followed by a number of other cases, regulatory decisions, and legislation that led to the transformation of the American long distance telephone industry from a monopoly to a competitive business.

Wide area synchronous grid

A wide area synchronous grid, also called an "interconnection" in North America, is an electrical grid at a regional scale or greater that operates at a synchronized frequency and is electrically tied together during normal system conditions. These are also known as synchronous zones, the largest of which is the synchronous grid of Continental Europe (ENTSO-E) with 667 gigawatts (GW) of generation, and the widest region served being that of the IPS/UPS system serving countries of the former Soviet Union. Synchronous grids with ample capacity facilitate electricity market trading across wide areas. In the ENTSO-E in 2008, over 350,000 megawatt hours were sold per day on the European Energy Exchange (EEX). As discovered in the California electricity crisis, there are strong incentives among some market traders to deliberately create congestion and poor management of generation capacity on an interconnection network to artificially inflate prices. Increasing transmission capacity and expanding the market by uniting with neighboring synchronous networks will make such manipulations more difficult.