If you live near the intersection of Oregon Expressway and Greer Road, there's a good chance that your household will be in the vanguard of Palo Alto's renewed effort to greatly expand its fiber-optic utility.

Known as Fiber to the Premises, the project involves an expansion of the city's fiber-optic backbone in phases: first to support municipal services and later to serve customers throughout Palo Alto.

If things go as planned, the backbone rebuild will cost about $25.6 million and the first major phase of the fiber expansion will cost about $20 million, according to the Utilities Department.

It will target a section of the city roughly bounded by Embarcadero Road on the north, Oregon and Clara Drive on the south, El Camino Real on the west and West Bayshore Road on the east. It would also set the stage for a citywide expansion at a cost of $102 million.

Before this grand expansion kicks off, however, city administrators are preparing to launch a pilot program in a small section within the first phase, which includes about 1,224 customers.

Located near Greer Park, the area is bounded by Embarcadero and Colorado Avenue to the north and south and by Louis and Bayshore roads to the west and east. It may see municipal fiber as early as February 2025, according to a new report from the Utilities Department.

The area is, in one sense, an unconventional choice for the fiber rollout, a project that has been debated for more than 20 years but that has only recently transformed from an abstract concept to an actual plan.

Last year, the city's consultant, Magellan Advisors, released a map showing the most promising areas to add fiber based on factors such as lower construction costs, higher customer interest, less competition from incumbent utility providers and higher density. The Greer Park area did not qualify under those criteria.

It will, however, move ahead of the rest of the city because it happens to be an area in which the city is pursuing its other expensive multi-year project: the upgrade of its electric grid.

The goal of that project, which has an estimated cost of $220 million to $306 million, is to enable the city to facilitate a widespread conversion by local businesses and residents from gas powered vehicles and appliances to electric ones.

An early component of the modernization project calls for converting 4 kV lines in the Greer Park area to 12 kV and replacing transformers.

Initially, this project was intended as a test to determine the feasibility of electrification design and construction methods, according to a report from David Yuan, strategic business manager at Utilities Department.

Then fiber was added to the mix. Now, the city is looking at ways to align the installation of fiber lines with the electrification and to analyze possible cost savings, timeline and resources required for aligning the two projects.

Crews will work on hundreds of miles, and the city's interested in preventing prolonged construction in neighborhoods, Yuan states in the report.

"In addition, aligning these projects in the pilot helps alleviate construction constraints as staff does not have enough internal resources to project manage, perform engineering make ready, and inspect construction for both projects in parallel."

A key challenge for both the fiber and the electrification efforts will be upgrading and, in some cases, replacing existing poles. The city co-owns 5,500 poles with AT&T under an agreement that goes back to 1918.

The process laid out in the agreement, wherein the city bills AT&T for pole repairs and replacement, may not be feasible to accommodate the high number of pole transactions associated with the two efforts, according to Yuan.

As the city negotiates with AT&T, it is also leaning on existing on-call contractors to perform engineering and construction work in the pilot area, a move that staff expects to save between six and nine months because it avoids going out to bid.

It will also inform the city on the best approaches to take as it moves ahead with the remaining phase one area, which includes an additional 1,241 poles and 5,560 customers, according to the report, which the City Council's Finance Committee is scheduled to discuss on Nov. 7.

"If financially self-sustaining, and deemed successful, the first phase of FTTP can become a springboard to a citywide FTTP deployment within five years," the report states.

The fiber project picked up momentum in December 2022, when the council voted 6-1 to move ahead with the phased fiber expansion. Council member Greg Tanaka dissented and argued that the city will not do well in competition with the two incumbents, AT&T and Comcast.

"To me, it doesn't seem like this is a game we should be playing as a city," Tanaka said at that meeting.

Others agreed that the project is worthwhile and the risk is limited, particularly if the system relies on its own revenues to pay for its expansion.

"We have a fiber fund accumulation of dollars that we're going to reinvest in expansion of a successful program that we've had for over 20 years," Burt said. "It gives us a foundation that if we are successful, we can grow it."