The increasing demand for capacity in Passive Optical Networks (PONs) is driving operators and vendors to explore new solutions, including the adoption of unamplified coherent technologies. In this study, we investigate a novel approach to enhance transmitted power in coherent PON systems. Our focus is on the Mach-Zehnder Modulator (MZM) and the process of electrical-to-optical signal conversion, introducing a parameter called the modulation index. We explore how the system can operate closer to the nonlinear region of the MZM’s transfer function while maintaining performance. Key performance metrics, including Bit Error Rate (BER) and Optical Distribution Network (ODN) loss, are used to evaluate the system’s behavior.