The analytical modeling for linear and non-linear impairments (LNI) for single mode fiber (SMF) and simulative analysis of extended power budget class-1 i.e. E1-class of next generation passive optic network-2 (NG-PON2) is presented in the paper. The proposed power-budget class time and wavelength division multiplexing (TWDM) based NG-PON2 network configuration is delivering symmetric 2.5 point-to-multi point (PtM) representing time and TWDM XGS-PON along with 10 Gbps point-to-point (PtP) wavelength division multiplexing (WDM) symmetric and coexistent channels (Ch) in worst-case scenario. Channel modelling of LNI is carried out under the incremental and aggregate strain of estimated chromatic dispersion CD, self-phase modulation (SPM), cross-phase modulation (XPM) of single mode fiber (SMF) channel deployed in optical distributing network (ODN) between 20 and 50 km link lengths. Downlink (D/L) and uplink (U/L) ODN is optimized to PT_ODN = 7.1 dBm and 4.09 dBm, respectively and corresponding channel imparities including Kerr parameter γ, corresponding SPM, XPM, CD, four-wave mixing (FWM) analysis and corresponding component power and efficiency, interchange crosstalk (Cc) attracting power penalties (Pc) are estimated and incorporated in the simulation for the real response of lossy SMF channel. Further, splitter power budget (SP) and slitter configuration for respective PtM and PtP D/L Ch are estimated under the aggregate impact of CD, SPM, XPM and FWM. Analytical modeling of LNI and simulative analysis has confirmed the configuration delivered rise in receiver sensitivity (Rxs) of − 39.75/− 33.45 dBm and − 29/− 35.34 dBm for D/L and U/L Ch respectively. The estimated power of FWM element is between 1.34 × 10⁻⁵² to 2.15 × 10⁻⁵³ and 3.87 × 10⁻⁵² to 2.41 × 10⁻⁵¹ contributing crosstalk between Ch (Cc) of − 31.97/− 30.12 dB for down/up spectrum under the impact of SPM and XPM respectively accommodating splitter configuration of 768 at 40 km.