NBN Co will attempt to "fall back" on its powers under Schedule 3 of the Telecommunications Act to work around an impasse with the NSW Government over access to power pole infrastructure.
iTnews reported on Monday that NBN Co had been unable to reach a commercial arrangement for access to power poles for portions of the NBN that were to receive overhead cabling.
The NSW Government is reportedly seeking $140 a pole, compared to $30-40 a pole in other states and territories.
NBN Co chief executive officer Mike Quigley told a parliamentary committee last night that the company had "fallen back on Schedule 3" of the Act as a workaround to continue the rollout in NSW.
According to the communications regulator, Schedule 3 "provides carriers with the power to inspect land to determine whether the land is suitable for the carriers' purposes; install a facility on the land; and the power to maintain a facility that is situated on the land."
"We're now following that process," Quigley said.
"We sincerely hope ... we can now form a good working relationship with [the utilities] on the basis of the Schedule 3 process. That's the notification we've served on them now."
The reliance on Schedule 3 means that any ongoing disputes could also be resolved via the Telecommunications Industry Ombudsman.
The Department of Communications said in a discussion paper last year that the TIO could "give directions in relation to the exercise by a carrier of its land access powers under Schedule 3..." (pdf).
"If there is a dispute about any particular job, it will go to the ombudsman who will decide what is fair compensation, and we're perfectly comfortable with that process," Quigley said.
"We'd have preferred to strike a commercial deal but we couldn't get there."
Quigley noted that NBN Co had already exercised Schedule 3 for applications to road and rail authorities for land access.
He also addressed comments made by NSW finance minister Greg Pearce that hosting NBN infrastructure on power poles could actually wind up costing state taxpayers money.
"We're at a loss to know why this would cost them anything," Quigley said.
"This in fact was a revenue stream of several hundred million dollars over a 20 year period that we would have paid NSW, and we would have paid for all the costs of installing all the fibre and any repairs they had to do to the pole."
Quigley said NBN Co was prepared to pay for new poles in the event that state utilities indicated "the weight loading on the pole is over their specs".
Only if a pole began to rot would the utility have to pay for its replacement, as it normally would under maintenance arrangements.
He described the complexity of negotiations with NSW. "The issue is it's kind of a whole of government and it needed the consensus agreement of the Department of Finance, Department of Premier and Cabinet, NSW Treasury, Transport NSW and the [state's] three energy companies".
Although Communications Minister Stephen Conroy accused the NSW Government of "gouging", Quigley skirted the issue when it was raised by independent MP Rob Oakeshott.