Coal cost for electricity increases 10 per cent

By China Daily


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Facing an increase in coal prices of up to 10 percent this year, China's electricity generators may seek government permission to raise the electricity prices again.

"Power producers may suggest to the government raise electricity tariffs in order to counter coal price increases of an average of 30 yuan per ton this year," said Ye Rongsi, senior adviser with the China Electricity Council (CEC).

But an analyst from the China Coal Industry Association, who did not want to be named, said power companies cannot easily raise prices as they face an on-grid electricity price bidding mechanism.

Rising coal prices have long been a bone of contention between power generators and coal producers in China. Electricity giants continue to insist that rising coal prices have undermined their profits.

Compared with the coal prices, which are more market-oriented, the nation's electricity prices are still controlled by the government.

Due to the rising cost of coal, the country's main resource for electricity production, the Chinese government decided to approve a mechanism linking coal and power prices at the end of 2004.

Under the linkage, electricity prices will move in line with coal price increases. If coal prices rise by more than 5 percent in a six-month period, electricity prices will be adjusted by the government.

Under the mechanism, 70 percent of coal price increases are passed on to consumers. Power generating firms absorb the remaining 30 percent.

Leaving key energy prices to market forces is an inevitable step on the road to a market-oriented economy, said Zhou Dadi, former director of the Energy Research Institute of the National Development and Reform Commission (NDRC).

Just a few days ago China's electricity giants and coal producers gathered in Guilin, South China's Guangxi Zhuang Autonomous Region, to sign this year's electricity coal supply contracts.

The recent gathering is the first after the government scrapped its previous coal procurement meeting. Unlike meetings in the past, electricity companies agreed to increases in coal prices without traditional tough negotiation.

Some analysts said the rapid development of the nation's electricity industry has meant power companies need more coal to fuel expansion, and are not in a position to take a tough stance.

And electricity consumption is certainly on the rise. Datang International Power Generation Co Ltd, one of the five main power companies in China, says the company produced 93.5 billion kilowatt- hours of electricity in 2006, an increase of 31.65 percent over 2005.

The rising price of coal is in part due to environmental and safety factors that have been included in overall cost calculations, said analysts.

"The coal price rise in China will be a gradual process," said Jiang Zhimin, vice-chairman of the China National Coal Association, "and the nation should further improve its coal pricing system to make it more market-oriented."

Coal-fired power plants account for over two thirds of the nation's installed capacity. Last year the nation's total generating capacity surpassed 622 gigawatts, an increase of 20.3 percent, according to stastics of CEC.

And the proportion of coal-fired power plants saw a rise in the total installed capacity amounting to over 77 percent.

The coal industry has also seen rapid development, producing 1.86 billion tons of coal in the first 11 months of 2006, an increase of 12 percent, said the National Bureau of Statistics.

China's coal output is expected to reach 2.6 billion tons in 2010 as it continues to be the nation's most important energy resource, according to an NDRC outline of the 11th Five-Year Plan (2006-10) for the coal industry.

Despite the nation's economic reform, technological innovation and energy-saving efforts, demand for coal will continue to grow, said the outline.

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America Going Electric: Dollars And Sense

California Net Zero Grid Investment will fuel electrification, renewable energy buildout, EV adoption, and grid modernization, boosting utilities, solar, and storage, while policy, IRA incentives, and transmission upgrades drive reliability and long-term rate base growth.

 

Key Points

Funding to electrify sectors and modernize the grid, scaling renewables, EVs, and storage to meet 2045 net zero goals.

✅ $370B over 22 years to meet 2045 net zero target

✅ Utilities lead gains via grid modernization and rate base growth

✅ EVs, solar, storage scale; IRA credits offset costs

 

$370 billion: That’s the investment Edison International CEO Pedro Pizarro says is needed for California’s power grid to meet the state’s “net zero” goal for CO2 emissions by 2045.

Getting there will require replacing fossil fuels with electricity in transportation, HVAC systems for buildings and industrial processes. Combined with population growth and data demand potentially augmented by artificial intelligence, that adds up to an 82 percent increase in electricity demand over 22 years, or 3 percent annually, and a potential looming shortage if buildout lags.

California’s plans also call for phasing out fossil fuel generation in the state, despite ongoing dependence on fossil power during peaks. And presumably, its last nuclear plant—PG&E Corp’s (PCG) Diablo Canyon—will be eventually be shuttered as well. So getting there also means trebling the state’s renewable energy generation and doubling usage of rooftop solar.

Assuming this investment is made, it’s relatively easy to put together a list of beneficiaries. Electric vehicles hit 20 percent market share in the state in Q2, even as pandemic-era demand shifts complicate load forecasting. And while competition from manufacturers has increased, leading manufacturers like Tesla TSLA -3% Inc (TSLA) can look forward to rising sales for some time—though that’s more than priced in for Elon Musk’s company at 65 times expected next 12 months earnings.

In the past year, California regulators have dialed back net metering through pricing changes affecting compensation, a subsidy previously paying rooftop solar owners premium prices for power sold back to the grid. That’s hit share prices of SunPower Corp (SPWR) and Sunrun Inc (RUN) quite hard, by further undermining business plans yet to demonstrate consistent profitability.

Nonetheless, these companies too can expect robust sales growth, as global prices for solar components drop and Inflation Reduction Act tax credits at least somewhat offset higher interest rates. And the combination of IRA tax credits and U.S. tariff walls will continue to boost sales at solar manufacturers like JinkoSolar Holding (JKS).

The surest, biggest beneficiaries of California’s drive to Net Zero are the utilities, reflecting broader utility trends in grid modernization, with investment increasing earnings and dividends. And as the state’s largest pure electric company, Edison has the clearest path.

Edison is currently requesting California regulators OK recovery over a 30-year period of $2.4 billion in losses related to 2017 wildfires. Assuming a amicable decision by early next year, management can then turn its attention to upgrading the grid. That investment is expected to generate long-term rate base growth of 8 percent at year, fueling 5 to 7 percent annual earnings growth through 2028 with commensurate dividend increases.

That’s a strong value proposition Edison stock, with trades at just 14 times expected next 12 months earnings. The yield of roughly 4.4 percent at current prices was increased 5.4 percent this year and is headed for a similar boost in December.

When California deregulated electricity in 1996, it required utilities with rare exceptions to divest their power generation. As a result, Edison’s growth opportunity is 100 percent upgrading its transmission and distribution grid. And its projects can typically be proposed, sited, permitted and built in less than a year, limiting risk of cost overruns to ensure regulatory approval and strong investment returns.

Edison’s investment plan is also pretty much immune to an unlikely backtracking on Net Zero goals by the state. And the company has a cost argument as well: Dr Pizarro cites U.S. Department of Energy and Department of Transportation data to project inflation-adjusted savings of 40 percent in California’s total customer energy bills from full electrification.

There’s even a reason to believe 40 percent savings will prove conservative. Mainly, gasoline currently accounts for a bit more than half energy expenditures. And after a more than 10-year global oil and gas investment drought, supplies are likely get tighter and prices possibly much higher in coming years.

Of course, those savings will only show up after significant investment is made. At this point, no major utility system in the world runs on 100 percent renewable energy, and California’s blackout politics underscore how reliability concerns shape deployment. And the magnitude of storage technology needed to overcome intermittency in solar and wind generation is not currently available let alone affordable, though both cost and efficiency are advancing.

Taking EVs from 20 to 100 percent of California’s new vehicle sales calls for a similar leap in efficiency and cost, even with generous federal and state subsidy. And while technology to fully electrify buildings and homes is there, economically retrofitting statewide is almost certainly going to be a slog.

At the end of the day, political will is likely to be as important as future technological advance for how much of Pizarro’s $370 billion actually gets spent. And the same will be true across the U.S., with state governments and regulators still by and large calling the shots for how electricity gets generated, transmitted and distributed—as well as who pays for it and how much, even as California’s exported policies influence Western markets.

Ironically, the one state where investors don’t need to worry about renewable energy’s prospects is one of the currently reddest politically. That’s Florida, where NextEra Energy NEE +2.8% (NEE) and other utilities can dramatically cut costs to customers and boost reliability by deploying solar and energy storage.

You won’t hear management asserting it can run the Sunshine State on 100 percent renewable energy, as utilities and regulators do in some of the bluer parts of the country. But by demonstrating the cost and reliability argument for solar deployment, NextEra is also making the case why its stock is America’s highest percentage bet on renewables’ growth—particularly at a time when all things energy are unfortunately becoming increasingly, intensely political.

 

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If B.C. wants to electrify all road vehicles by 2055, it will need to at least double its power output: study

B.C. EV Electrification 2055 projects grid capacity needs doubling to 37 GW, driven by electric vehicles, renewable energy expansion, wind and solar generation, limited natural gas, and policy mandates for zero-emission transportation.

 

Key Points

A projection that electrifying all B.C. road transport by 2055 would more than double grid demand to 37 GW.

✅ Site C adds 1.1 GW; rest from wind, solar, limited natural gas.

✅ Electricity price per kWh rises 9%, but fuel savings offset.

✅ Significant GHG cuts with 93% renewable grid under Clean Energy Act.

 

Researchers at the University of Victoria say that if B.C. were to shift to electric power for all road vehicles by 2055, the province would require more than double the electricity now being generated.

The findings are included in a study to be published in the November issue of the Applied Energy journal.

According to co-author and UVic professor Curran Crawford, the team at the university's Pacific Institute for Climate Solutions took B.C.'s 2015 electrical capacity of 15.6 gigawatts as a baseline, and added projected demands from population and economic growth, then added the increase that shifting to electric vehicles would require, while acknowledging power supply challenges that could arise.

They calculated the demand in 2055 would amount to 37 gigawatts, more than double 15.6 gigawatts used in 2015 as a baseline, and utilities warn of a potential EV charging bottleneck if demand ramps up faster than infrastructure.

"We wanted to understand what the electricity requirements are if you want to do that," he said. "It's possible — it would take some policy direction."

B.C. announces $4M in rebates for home and work EV charging stations across the province
The team took the planned Site C dam project into account, but that would only add 1.1 gigawatts of power. So assuming no other hydroelectric dams are planned, the remainder would likely have to come from wind and solar projects and some natural gas.

"Geothermal and biomass were also in the model," said Crawford, adding that they are more expensive electricity sources. "The model we were using, essentially, we're looking for the cheapest options."
Wind turbines on the Tantramar Marsh between Nova Scotia and New Brunswick tower over the Trans-Canada Highway. If British Columbia were to shift to 100 per cent electric-powered ground transportation by 2055, the province would have to significantly increase its wind and solar power generation. (Eric Woolliscroft/CBC)
The electricity bill, per kilowatt hour, would increase by nine per cent, according to the team's research, but Crawford said getting rid of the gasoline and diesel now used to fuel vehicles could amount to an overall cost saving, especially when combined with zero-emission vehicle incentives available to consumers.

The province introduced a law this year requiring that all new light-duty vehicles sold in B.C. be zero emission by 2040, while the federal 2035 EV mandate adds another policy signal, so the researchers figured 2055 was a reasonable date to imagine all vehicles on the road to be electric.

Crawford said hydrogen-powered vehicles weren't considered in the study, as the model used was already complicated enough, but hydrogen fuel would actually require more electricity for the electrolysis, when compared to energy stored in batteries.

Electric vehicles are approaching a tipping point as faster charging becomes more available — here's why
The study also found that shifting to all-electric ground transportation in B.C. would also mean a significant decrease in greenhouse gas emissions, assuming the Clean Energy Act remains in place, which mandates that 93 per cent of grid electricity must come from renewable resources, whereas nationally, about 18 per cent of electricity still comes from fossil fuels, according to 2019 data. 

"Doing the electrification makes some sense — If you're thinking of spending some money to reduce carbon emissions, this is a pretty cost effective way of doing that," said Crawford.

 

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The Haves and Have-Nots of Electricity in California

California Public Safety Power Shutoffs highlight wildfire prevention as PG&E outages disrupt schools, businesses, and rural communities, driving generator use, economic hardship, and emergency preparedness across Northern California during high-wind events.

 

Key Points

Utility outages to reduce wildfire risk during extreme winds, impacting homes and businesses in high-risk California.

✅ PG&E cuts power during high winds to prevent wildfires

✅ Costs rise for generators, fuel, batteries, and spoiled food

✅ Rural, low-income communities face greater economic losses

 

The intentional blackout by California’s largest utility this week put Forest Jones out of work and his son out of school. On Friday morning Mr. Jones, a handyman and single father, sat in his apartment above a tattoo parlor waiting for the power to come back on and for school to reopen.

“I’ll probably lose $400 or $500 dollars because of this,” said Mr. Jones, who lives in the town of Paradise, which was razed by fire last year and is slowly rebuilding. “Things have been really tough up here.”

Millions of people were affected by the blackout, which spanned the outskirts of Silicon Valley to the forests of Humboldt County near the Oregon border. But the outage, which the power company said was necessary to reduce wildfire risk across the region, also drew a line between those who were merely inconvenienced and those who faced a major financial hardship.

To have the lights on, the television running and kitchen appliances humming is often taken for granted in America, even as U.S. grid during coronavirus questions persisted. During California’s blackout it became an economic privilege.

The economic impacts of the shut-off were especially acute in rural, northern towns like Paradise, where incomes are a fraction of those in the San Francisco Bay Area.

Both wealthy and poorer areas were affected by the blackout but interviews across the state suggested that being forced off the grid disproportionately hurt the less affluent. One family in Humboldt County said they had spent $150 on batteries and water alone during the shutdown.

“To be prepared costs money,” Sue Warhaftig, a massage therapist who lives in Mill Valley, a wealthy suburb across the Golden Gate Bridge from San Francisco. Ms. Warhaftig spent around two days without electricity but said she had been spared from significant sacrifices during the blackout.

She invested in a generator to keep the refrigerator running and to provide some light. She cooked in the family’s Volkswagen camper van in her driveway. At night she watched Netflix on her phone, which she was able to charge with the generator. Her husband, a businessman, is in London on a work trip. Her two sons, both grown, live in Southern California and Seattle.

“We were inconvenienced but life wasn’t interrupted,” Ms. Warhaftig said. “But so many people’s lives were.

Pacific Gas & Electric restored power to large sections of Northern California on Friday, including Paradise, where the electricity came back on in the afternoon. But hundreds of thousands of people in other areas remained in the dark. The carcasses of burned cars still littered the landscape around Paradise, where 86 people died in the Camp Fire last year, some of them while trying to escape.

Officials at power company said that by Saturday they hoped to have restored power to 98 percent of the customers who were affected.

The same dangerous winds that spurred the shut-off in Northern California have put firefighters to work in the south. The authorities in Los Angeles County ordered the evacuation of nearly 100,000 people on Friday as the Saddleridge Fire burned nearly 5,000 acres and destroyed 25 structures. The Sandalwood Fire, which ignited Thursday in Riverside County, had spread to more than 800 acres and destroyed 74 structures by Friday afternoon.

While this week’s outage was the first time many customers in Northern California experienced a deliberate power shut-off, residents in and around Paradise have had their power cut four times in recent months, residents say.

Many use a generator, but running one has become increasingly expensive with gasoline now at more than $4 a gallon in California.

On Friday, Dennis and Viola Timmer drove up the hill to their home in Magalia, a town adjacent to Paradise, loaded with $102 dollars of gasoline for their generators. It was their second gasoline run since the power went out Tuesday night.

The couple, retired and on a fixed income after Mr. Timmer’s time in the Navy and in construction, said the power outage had severely limited their ability to do essential tasks like cooking, or to leave the house.

“You know what it feels like? You’re in jail,” said Ms. Timmer, 72. “You can’t go anywhere with the generators running.”

Since the generators are not powerful enough to run heat or air conditioning, the couple slept in their den with an electric space heater.

“It’s really difficult because you don’t have a normal life,” Ms. Timmer said. “You’re trying to survive.”

To be sure, the shutdown has affected many people regardless of economic status, and similar disruptions abroad, like a London power outage that disrupted routines, show how widespread such challenges can be. The areas without power were as diverse as the wealthy suburbs of Silicon Valley, the old Gold Rush towns of the Sierra Nevada, the East Bay of San Francisco and the seaside city of Arcata.

Ms. Cahn’s cellphone ran out of power during the blackout and even when she managed to recharge it in her car cell service was spotty, as it was in many areas hit by the blackout.

Accustomed to staying warm at night with an electric blanket, Ms. Cahn slept under a stack of four blankets.

“I’m doing what I have to do which is not doing very much,” she said.

Further south in Marin City, Chanay Jackson stood surrounded by fumes from generators still powering parts of the city.

She said that food stamps were issued on the first of the month and that many residents who had to throw away food were out of luck.

“They’re not going to issue more food stamps just because the power went out,” Ms. Jackson said. “So they’re just screwed until next month.”

Strong winds have many times in the past caused power lines to come in contact with vegetation, igniting fires that are then propelled by the gusts, and hurricanes elsewhere have crippled infrastructure with Louisiana grid rebuild after Laura according to state officials. This was the case with the Camp Fire.

Since higher elevations had more extreme winds many of the neighborhoods where power was turned off this week were in hills and canyons, including in the Sierra Nevada.

The shut-off, which by one estimate affected a total of 2.5 million people, has come under strong criticism by residents and politicians, and warnings from Cal ISO about rolling blackouts as the power grid strained. The company’s website crashed just as customers sought information about the outage. Gov. Gavin Newsom called it unacceptable. But his comments were nuanced, criticizing the way the shut-off was handled, not the rationale for it. Mr. Newsom and others said the ravages of the Camp Fire demanded preventive action to prevent a reoccurrence.

Yet the calculus of trying to avoid deadly fires by shutting off power will continue to be debated as California enters its peak wildfire season, even as electricity reliability during COVID-19 was generally maintained for most consumers.

In the city of Grass Valley, Matthew Gottschalk said he and his wife realized that a generator was essential when they calculated that they had around $500 worth of food in their fridge.

“I don’t know what we would have done,” said Mr. Gottschalk, whose power went out Tuesday night.

His neighbors are filling coolers with ice. Everyone is hoping the power will come back on soon.

“Ice is going to run out and gas is going to run out,” he said.

 

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Paris Finalises Energy Roadmap for 2025–2035 with Imminent Decree

France 2025–2035 Energy Roadmap accelerates carbon neutrality via renewables expansion, energy efficiency, EV adoption, heat pumps, hydrogen, CCS, nuclear buildout, and wind and solar targets, cutting fossil fuels and emissions across transport, housing, industry.

 

Key Points

A national plan to cut fossil use and emissions, boost renewables, and scale efficiency and clean technologies.

✅ Cuts fossil share to 30% by 2035 with efficiency gains

✅ Scales solar PV and wind; revives nuclear with EPR 2

✅ Electrifies transport and industry with EVs, hydrogen, CCS

 

Paris is on the verge of finalising its energy roadmap for the period 2025–2035, with an imminent decree expected to be published by the end of the first quarter of 2025. This roadmap is part of France's broader strategy to achieve carbon neutrality by 2050, aligning with wider moves toward clean electricity regulations in other jurisdictions.

Key Objectives of the Roadmap

The energy roadmap outlines ambitious targets for reducing greenhouse gas emissions across various sectors, including transport, housing, food, and energy. The primary goals are:

  • Reducing Fossil Fuel Dependency: Building on the EU's plan to dump Russian energy, the share of fossil fuels in final energy consumption is to fall from 60% in 2022 to 42% in 2030 and 30% in 2035.

  • Enhancing Energy Efficiency: A target of a 28.6% reduction in energy consumption between 2012 and 2030 is set, focusing on conservation and energy efficiency measures.

  • Expanding Decarbonised Energy Production: The roadmap aims to accelerate the development of renewable energies and the revival.

Sector-Specific Targets

  • Transport: The government aims to cut emissions by 31, focusing on the growth of electric vehicles, increasing public transport, and expanding charging infrastructure.

  • Housing: Emissions from buildings are to be reduced by 44%, with plans to replace 75% of oil-fired and install 1 million heat pumps.

  • Agriculture and Food: The roadmap includes measures to reduce emissions from agriculture by 9%, promoting organic farming and reducing the use of nitrogen fertilizers.

  • Industry: A 37% reduction in emissions is targeted through the use of electricity, biomass, hydrogen, and CO₂ capture and storage technologies informed by energy technology pathways outlined in ETP 2017.

Renewable Energy Targets

The roadmap sets ambitious targets for renewable energy production that align with Europe's ongoing electricity market reform efforts:

  • Photovoltaic Power: A sixfold increase in photovoltaic power between 2022

  • Offshore Wind Power: Reaching 18 gigawatts up from 0.6 GW

  • Onshore Wind Power: Doubling capacity from 21 GW to 45 GW over the same period.

  • Nuclear Power: The commissioning of the evolutionary power and the construction of six EPR 2 reactors, underpinned by France's deal on electricity prices with EDF to support long-term investment, with the potential for eight more.
     

Implementation and Governance

The final version of the roadmap will be adopted by decree, alongside a proposed electricity pricing scheme to address EU concerns, rather than being enshrined in law as required by the Energy Code. The government had previously abandoned the energy-climate planning. The decree is expected to be published at the end of the Multiannual Energy Program (PPE) and in the second half of the third National Low-Carbon Strategy (SNBC).

Paris's finalisation of its energy roadmap for 2025–2035 marks a significant step towards achieving carbon neutrality by 2050. The ambitious targets set across various sectors reflect a comprehensive approach to reducing greenhouse gas emissions and transitioning to a more sustainable energy system amid the ongoing EU electricity reform debate shaping market rules. The imminent decree will provide the legal framework necessary to implement these plans and drive the necessary changes across the country.

 

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New York State to investigate sites for offshore wind projects

NYSERDA Offshore Wind Data initiative funds geophysical and geotechnical surveys, seabed and soil studies on New York's shelf to accelerate siting, optimize foundation design, reduce costs, and advance clean energy deployment.

 

Key Points

State funding to support surveys and soil studies guiding offshore wind siting, design, and cost reduction.

✅ Up to $5.5M for geophysical and geotechnical data collection

✅ Focus on seabed soils, shelf geology, and foundation design inputs

✅ Accelerates siting, reduces risk, and lowers offshore wind costs

 

The New York State Energy Research and Development Authority (NYSERDA) is investing up to $5.5 million for the collection of geophysical and geotechnical data to determine future offshore wind development sites.

The funding is to look at seabed soil and geological data for the preliminary design and installation requirements for future offshore wind projects. Its part of N.Y. Gov. Andrew Cuomos plan to develop 9,000 megawatts of offshore wind energy by 2035.

Todays announcement is another step in Governor Cuomos steadfast march to achieving 9,000 megawatts of offshore wind by 2035, putting New York in a clear national leadership position when it comes to advancing this new industry through large-scale energy projects across the state. The surveys NYSERDA will be funding under this solicitation will expand the offshore wind industrys access to geophysical and geotechnical data that will provide the foundation for future offshore wind development in these areas, and accelerate project development while driving down costs, NYSERDA President and CEO Alicia Barton said.

NYSERDA will select one or more contractors to do the investigations, while recent DOE wind energy awards support complementary research, and develop a model for describing geophysical and geotechnical conditions. NYSERDA will also select a contractor to support project management and host the data that is collected. The submission deadline is Jan. 21, 2020.

Todays announcement builds on the data collected in a Geotechnical and Geophysical Desktop Study also released today, which includes information on the middle continental shelf off the shore of New York and New Jersey, where BOEM lease requests are shaping activity, creating a regional overview of the seafloor and sub-seafloor environment as it relates to offshore wind development.

Strong knowledge of environmental conditions and factors, including seabed soil conditions, are essential for the installation of offshore projects, such as Long Island proposals, but only a limited amount of soil sampling and testing has been undertaken to date.

The collection of geophysical and geotechnical data from areas off of New Yorks Atlantic coast is yet another demonstration of New Yorks leadership promoting the responsible development of offshore wind. The data generated by this initiative will ultimately lead to better projects, lower cost, and enhanced safety. New York is leading the way to a clean energy future, as the state finalizes renewable project contracts that expand capacity, and relying on data collection and sound science to get us there, New York Offshore Wind Alliance Director Joe Martens said.

 

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Russian hackers accessed US electric utilities' control rooms

Russian Utility Grid Cyberattacks reveal DHS findings on Dragonfly/Energetic Bear breaching control rooms and ICS/SCADA via vendor supply-chain spear-phishing, threatening blackouts and critical infrastructure across U.S. power utilities through stolen credentials and reconnaissance.

 

Key Points

State-backed ops breaching utilities via vendors to reach ICS/SCADA, risking grid disruption and control-room access.

✅ Spear-phishing and watering-hole attacks on vendor networks

✅ Stolen credentials used to reach isolated ICS/SCADA

✅ Potential to trigger localized blackouts and service disruptions

 

Hackers working for Russia were able to gain access to the control rooms of US electric utilities last year, allowing them to cause blackouts, federal officials tell the Wall Street Journal.

The hackers -- working for a state-sponsored group previously identified as Dragonfly or Energetic Bear -- broke into utilities' isolated networks by hacking networks belonging to third-party vendors that had relationships with the power companies, the Department of Homeland Security said in a press briefing on Monday.

Officials said the campaign had claimed hundreds of victims and is likely continuing, the Journal reported.

"They got to the point where they could have thrown switches" to disrupt the flow power, Jonathan Homer, chief of industrial-control-system analysis for DHS, told the Journal.

"While hundreds of energy and non-energy companies were targeted, the incident where they gained access to the industrial control system was a very small generation asset that would not have had any impact on the larger grid if taken offline," the DHS said in a statement Tuesday. "Over the course of the past year as we continued to investigate the activity, we learned additional information which would be helpful to industry in defending against this threat."

Organizations running the nation's energy, nuclear and other critical infrastructure have become frequent targets for cyberattacks in recent years due to their ability to cause immediate chaos, whether it's starting a blackout or blocking traffic signals. These systems are often vulnerable because of antiquated software and the high costs of upgrading infrastructure.

The report comes amid heightened tension between Russia and the US over cybersecurity, alongside US condemnation of power grid hacking in recent months. Earlier this month, US special counsel Robert Mueller filed charges against 12 Russian hackers tied to cyberattacks on the Democratic National Committee.

Hackers compromised US power utility companies' corporate networks with conventional approaches, such as spear-phishing emails and watering-hole attacks as seen in breaches at power plants across the US that target a specific group of users by infecting websites they're known to visit, the newspaper reported. After gaining access to vendor networks, hackers turned their attention to stealing credentials for access to the utility networks and familiarizing themselves with facility operations, officials said, according to the Journal.

Homeland Security didn't identify the victims, the newspaper reports, adding that some companies may not know they had been compromised because the attacks used legitimate credentials to gain access to the networks.

Cyberattacks on electrical systems aren't an academic matter. In 2016, Ukraine's grid was disrupted by cyberattacks attributed to Russia, which is engaged in territorial disputes with the country over eastern Ukraine and the Crimean peninsula. Russia has denied any involvement in targeting critical infrastructure.

President Donald Trump signed an executive order in May designed to bolster the United States' cybersecurity by protecting federal networks, critical infrastructure and the public online. One section of the order focuses on protecting the grid like electricity and water, as well as financial, health care and telecommunications systems.

The Department of Homeland Security didn't respond to a request for comment.

 

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