When combined with existing commercial fibre roll-outs, the deal "should result in around 87% of premises in the county being able to access fibre broadband by the end of summer 2016", the council said.
BT says it has already made fibre broadband available to more than 500,000 Essex premises as part of its existing commercial roll-out.
According to industry regulator Ofcom, the average broadband access speed in Essex is 11.5mbps, while 12.5% of premises received less than 2mbps. By 2016, most premises should be able to access services running at over 24mbps.
BT is contributing £11.7 million towards the overall cost of fibre deployment in “non-commercial” (rural) areas in Essex, while the county council is putting in £6.46 million, with a further £6.46m of matching funding coming from the government’s Broadband Delivery UK (BDUK) funds.
Kevin Bentley, deputy leader and cabinet member for economic growth and infrastructure at Essex County Council, said: “These upgrades will make a real difference to Essex residents and businesses that have difficulty trading and communicating online because of slow speeds."
Earlier this week Nottinghamshire County Council awarded a rural broadband contract to BT which is worth a total of £20 million.
Last month the parliamentary Public Accounts Committee slammed the national rural broadband programme, claiming BT was not being clear enough about the charges it was levying councils to deliver it.